👻 A scene out of a horror movie. A television show that never knows when to end. A roller coaster ride. Dumpster fire. A year of missing. Six feet apart, yet closer than ever. No matter how we describe the year 2020, it was our daily search for little wins, that helped us fight it.💪 And in these surreal circumstances, India faced many challenges. Millions are unemployed and stranded, the decline of the GDP, the new Farmers Bill and not to forget the rumored Covid Tax. Amidst all of this, everyone is eagerly waiting for Budget 2021. There are a lot of expectations🧐from the first Paperless Union Budget and we cannot deny that.
👊 Taxed by the Pandemic. Heard of the Covid cess? It is a high probability that the government might be headed in that direction. It might operate as a ‘millionaire tax’ i.e. a cess on high-income earners.🤑 A lot of countries have already thought about adopting this. The government needs to find ways to meet the expenditures coming our way. The 1st rollout of the COVID-19 vaccine might cost the government approximately INR 25k crore. And the 2nd rollout might cost another INR 40k crore. Jharkhand has already imposed a Covid cess on minerals.
⚕️ Overwhelmed Healthcare. The pandemic exposed the shortcomings of the healthcare units – they were overwhelmed. A deduction towards increased health expenses and an increase in benefits under section 80D of the Income Tax Act might be a major relief. More expenditure on pharma research and disease surveillance is expected.
👨🌾 Farmers are the Food Source. One of the few sectors that performed strongly and more than one reason to focus on agriculture. With the ongoing farmers’ agitation in New Delhi, the government is expected to send across a positive message to the farmers in the country. The farmers have made their demands clear: a guarantee on the Minimum Support Price (MSP) and permanent withdrawal of the three farm laws.📜 As farmers continue to protest in New Delhi, it will be interesting to see if the Centre has any plan to quell the agitation in its budget.
🗻 A New Point of VIEW. The travel and tourism industry has suffered a lot. With the nation in complete lockdown for months, it trying to regain its position as a major revenue/employment generator. This is one of the sectors which did not receive any stimulus package. Maybe Income Tax Deduction on domestic travel.✈️ Overall, certain concessions and rebates and a road map are expected in the Budget. The industry needs to pick the pace and move towards pre-Covid levels.
🏠 The New Normal. We all know what this is…Work From Home. Employers usually reimburse the employees for the infrastructure cost to set up ergonomic work stations at home. Moreover, a lot of periodic and healthcare expenses such as Internet charges, electricity bills, mobile expenses, cost of stationery, and gym facilities🏋️ are looked after. There is no specific income tax provision exempting the payment of such allowance/reimbursements. They may be held to be taxable if not clarified in the Tax Rules. 🤔Do you think the government might clarify that such employer costs are not taxable in the hands of the employees, whether they are provided as reimbursements to employees or as allowances?
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☕ High Tea in Boston – Crazy Tax Story
🎓 What’s known about the Boston Tea party? A bunch of angry colonists dressed as Native Americans, throwing chests of tea in the ocean.
🧵 But the story is far more complicated. Full of twists from bankruptcy, smuggling, and massacres. This event represents the grassroots of the origins of the American revolution. Compared it to India’s very own uprising of 1857 against the Enfield rifle cartridges which was rumored to be greased with animal fat.
☝️ The first thing we need to know. In the 1700s, tea was really popular, not only in England but also in English colonies such as America. By the mid-1700s, millions of pounds of tea were consumed every year. So obviously, when Britain wanted to increase taxes on Tea in America, people were furious. The American colonists had no say in the taxation policy which was made back in London.
🙅 No Taxation without representation. Americans believed that they were not subject to taxes that were imposed without their representation in the legislature. Hence, they avoided tax collectors. With the British tax system of enforcement being lax, more than 75% of the tea consumed in America was smuggled in.
💸 Unlike the Americans. The British believed that they had the authority to collect taxes from their colonies. After fighting the French war, Britain was in great debt and finally decided to bridge the gap by collecting tax from the Americans and imported a variety of new taxes, especially on their beloved tea.
😠 An extreme response. The Americans boycotted British tea and started brewing their own. Matters went from bad to worse when British troops fired on a mob in Boston which was soon called “The Boston Massacre”.
The British parliament tackled the situation by sending in consignments directly from the British East India Company, and reduced the price significantly, thus making it competitive to the smuggled variety, while still managing to collect taxes. The Americans saw right through their monopolistic behavior. One night, when the harbor had a new consignment of tea, about 50 men dressed as native Americans marched at Griffin’s Wharf in Boston and threw hundreds of the chests overboard.
The Boston tea party was the first step to the chain of rebellions leading to the declaration of independence for the Americans. They’d eventually be free to drink tea without worrying about taxes.