I need your comments please ! I have a 8 point programme for a Corruptionless India?

Question

1. Every citizen should be provided with a permanant account number
2. Cash transactions should be discouraged by printing money upto the denomination of Rs.100.00 only
3. All transactions above Rs.1000/- to be made through banks with dr/cr card, funds transfer, chq/dd or online payments.
4. All taxes (IT,ST,cess,ED,service tax etc.,) should be dropped. Only transaction tax of 1% on each bank transaction let it be debit or credit to be levied and automatically transferred to treasury a/c. (I think this will be sufficient to replace all the taxes)
5. Banks should maintain one a/c and give uniform interest.
6. If all taxes are dropped, somuch of paper work and filing of returns, maintainance,inspecting and scrutinising will vanish & the people used for this purpose can be utilised to do for more productivily
7. If cash transactions are discouraged, then corruption,black money etc. will fall to nil.
8. budget only for proper expenditure and need not worry abt income.

Answer 1

I find yiur thoughts considerably in agreement with mine.As a former Officer in the financial realm, I see some practical problems in implementing your ideas.

Issue of 105 crores PAN cards or Identification numbers is a gigantic task. Take a look at the Electoral Identity Card affair, languishing for the past decade or more.

Dispensing with Cash transactions for values above Rs. 100 will be unviable with a population yet to learn to use an Electronic machine , leave alone ATMs. Rushing through with such a reform at this stage will open opportunities for manipulators to transfer the money of the poor into their Accounts in the guise of helping them as happened in the early days of literacy in our country when poor people's lands were taken away by using forged documents with genuine thumb impressions.

Tax rate of 1% is okay for all the small and medium earners. But at least five %contribution from the larger players who derive the maximum benefit from the Government system is necessary. The difficulty here with the automatic transfer of the tax money to government treasury is what I have said about poor people's transactions. Till everybody becomes capable of operating ATM type transaction machines for every transaction, this has to wait. But the Government can print and issue stamps of appropriate value which can be attached to the documents and signed by the recipients. There was such a system of Receipt Tax prevailing in Goa before Income Tax was introduced. in 1964-65/1965-66. It worked well and there were no evasion of tax. Only problem here is the kind of Telgis and their masters.

A system of a single Account for a person is unwieldy for Banks to operate since they have to comply with a large number of regulatory procedures and Accounts of Fixed Deposits and Current Accounts being maintained independently is a must to facilitate compliance.But a statutory requirement to link a person's each and every Bank Account with his PAN number can and should be made as soon as the Number arrangement is completed.Here it is necessary that Artificial juridical persons such as firms, Companies and Trusts ,etc are to be covered by these arrangements.

There will necessarily be a lot of reduction in paper work, not to talk of reduction in the corruption related to tax assessment cases. But a token force will still have to be maintained in the Audit wing to make sure that the tax is in fact deducted.
Stopping of Cash transactions will not stop the generation of black money by itself. The Valuations declared in every property transaction shall be mandatorily checked by the District Collector/ D.M. and lapses investigated and those who make under valued transaction should be penalised in like manner as done during 1995-97 by taking over the property after giving fifteen percent extra. over the declared value. Cases detected after such scrutiny by the Collectors should be viewed seriously and the Collectors dealt with severely.

Budget for expenditure cannot be done without assessing the Income trends.

Answer 2

a very good proposal,
Only one thing to note
How can we discourage people accepting money more than 1000/-. And the cheques is normally not accepted all over due to uncertainity of payment.

Any way I appreciate ur proposal.