SOMETHING IS BETTER THAN NOTHING

On 05 Feb 2016 , Economic Times carried a news report titled : 

Employers May Get Sops for Creating Extra Jobs

As per this report , NDA govt is expected to announce following incentives for employers who create new jobs :

*  30 % tax exemption for units that create an additional 2 % jobs

*  Alternatively, the hirer could be given a 125 % rebate on provident fund contributions

*  Availability of easy, cheap credit through interest subvention ( Subsidy ? )

Even as I await the budget speech of Shri Jaitleyji on 29 Feb for full details , I wish to thank Shri Narendra Modiji for considering the CORE of my following proposal sent to him on  06 Nov 2014 :

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To complete this ECO SYSTEM , we  need to think " Out of the Box " in the matter of Corporate Tax Regime , as well

Current trend in industry , all over the world , is to

>  Add highly productive , very expensive machinery to " Automate " all

    manufacturing processes

>  Reduce manpower by increasing " Capital / IT Intensity "

>  Hire low skilled workers by transferring higher " Skills " to machinery

>  Outsource manufacturing to countries where manpower is cheap

>  Move out of " Manufacturing " and shift to " Services "

India cannot swim against this World-wide Trend

We must innovate,  to not only survive but to grow in this scenario

Here is my suggestion :

Set in motion , " INVERSION  of JOB  REDUCTION " regime , under which ,

"  The more jobs a company creates , the less Corporate Tax it pays "

Example :

> Up to employment of 100 persons  ............................... 30 %

> 101  -  500 persons....................................................  25  %

>  501 - 1000 persons ...................................................  20  %

>  1001 - 5000 persons ..................................................  15  %

>  5001 - 10,000 persons ................................................. 10  %

>  Above 10,000 persons .................................................    5  %

Let us celebrate those who provide employment to large number of persons

Let us celebrate BIGNESS

Let us create hundreds of  WORLD SIZE  corporations and take on the World

On top of this , provide additional tax - breaks ( discounts ? ) to corporate as follows :

> Average Age of Employees at 30 years.......................  1 %

> Ave age at 25 years.................................................  2 %

> Ave age at 20 years .................................................  3 %



Of course , very strict and transparent rules will need to be framed to

compute,


>  Number of Employees  ( Permanent - not probationers / trainees )


> Average Age ( as on 31 March of Tax year )......etc




But , here is an important aspect of this ," Incentivize  Job  Creation "  Scheme :


Today's labour laws make it extremely difficult - if not impossible - for employers to layoff / retrench workmen , if demand shrinks


Hence , to take advantage of this Scheme , employers are unlikely to hire thousands of youth , if they cannot easily trim the workforce , to match the shrinking demand


So , an important corollary of this Scheme is to modify our existing Labour Laws to facilitate layoff / retrenchment , when situation so demands , while protecting the interests of the workmen concerned

And , last but not the least , permit each and every candidate - and the political parties as well - to spend ANY AMOUNT on election campaigns , without any restrictions as also accept any amount of Corporate Donations by cheque

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hemenparekh.in / blogs

07  Feb  2016

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Make    Yourself    Heard

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By emailing this suggestion - incorporating your OWN improvements - to the following Policy Makers

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