At the bottom of the 42 page Election Manifesto of BJP
, released yesterday , I tried to search , if in very small print somewhere , there
was a footnote which read ,
" Please ,
don't ask how we plan to implement these promises ;
From where we
plan to find all the money to execute these projects "
Here are my back-of-the-envelope estimates of what some
of the MAJOR projects might cost :
------------------------------------------------------------------------------------
PROJECT
.................................... Approx Cost ( Rs Lakh * Crores )
-------------------------------------------------------------------------------------
> 100 Mega
Cities........................ 90
> Interlinking
of Rivers.................. 60
> Sagar Mala
of Ports.................... 30
> Highways (
25,000 Km ).............. 50
> Housing (
100 mill units )............ 100
> Rivers
Cleaning.......................... 10
> Other Infra
Projects.................... 100
* Freight
Corridors
* Gas Grids
* OFC Network
------------------------------------------------------------------------------------
Total ..........................................Rs 430 Lakh Crores
------------------------------------------------------------------------------------
Admittedly , not all of these money will be required in
the very first budget that NaMo government ( - of course , only if voted to
power ! ) , would present by end June 2014
But a problem does not go away by postponement !
There is only ONE viable solution to the FUNDING
problem , viz:,
> Union
Government must NOT even try to fund these projects !
There is NO WAY , it can find these kind of money thro
taxation !
There will be a revolt
!
ANSWER
> Make it
possible for the PUBLIC to invest into these projects by " owning "
these
projects - and earn a reasonable " tax-free " return on investments
( Bonds ? )
in these projects
> Towards this end , create various INFRASTRUCTURE SPVs
> Immediately
modify PERSONAL INCOME TAX regime as follows :
> Up to
Rs 5 lakhs.....................
NIL
> 5.1 -
10 lakhs....................... 8 %
> 10.1 - 20 lakhs...................... 6 %
> 20.1 -
50 lakhs..................... 5 %
> 50.1 - 100 lakhs..................... 3 %
> Above 100 lakhs...................... 1 %
What is likely to happen with such " INVERSE TAXATION
" regime ?
Following few things :
> Total personal tax payer base will go up dramatically
from current 4
crores tax-payers
> with this " INVERSE TAX REGIME "
, there will be no incentive to evade
taxes and to generate " BLACK
MONEY "
There will be no resistance to accept ALL payments by cheque / electronic
clearance
The more you disclose as your income , the less
you pay by way of taxes
( Of course , incrementally )
> For a change , we will learn to reward honesty /
efficiency / productivity !
No need to bribe those Income Tax
officers !
> Suddenly , lakhs of crores of BLACK MONEY will become WHITE MONEY
> There will be a huge surge in bank deposits ( - even
with , the inevitable
lower interest rates )
> Banks will be awash with funds to finance businesses /
infrastructure
projects etc , encouraging entrepreneurs /
self-employed to set up new
businesses ( at 2 % interest rates of loans ) and
generate millions of jobs
In any case , BJP manifesto promises :
> Rationalization and simplification of the tax
regime - which is currently
repulsive for honest tax payers
> The process
of bringing black money to India , what belongs to India , will
be put in
motion on priority
> Minimize
scope for Corruption
Narendrabhai ,
Here is your chance to ditch the " Historical
Baggage " into the Indian Ocean
and come up with an INNOVATION that will take India ahead of China !
If President Kubitschek of Brazil ( 1956-61 ) - son of
a poor salesman - could construct Capital city BRASILIA and a 1500 Km highway ,
in 41 months , surely , you can do better , 57 years later !
* hemen parekh
( 08 April 2014 /
Mumbai )