• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Brand Quest
• The New Manager

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

The editorial “Taxing indirectly” (Business Line, December 10) has correctly observed that “as direct tax collections rise smartly, Central and State governments have the chance to bring down indirect tax rates”.

Though, by definition, the burden of paying indirect taxes is not felt by the people as they are included in the prices of commodities, this is not fully true.

The salaried people, in particular, after paying sizeable amount as income tax to the government, are left with less disposable income, which in turn, forces them to curtail their expenditure on consumption.

If the governments enhance the indirect taxes (sales tax, excise duty, and so on) on commodities, these will result in cost-push inflation which affects the poor and the salaried. The situation is nothing but confiscation without compensation.

The governments must reduce at least indirect tax rates on essential goods to give relief to the common man.

S. Ramakrishnasayee Ranipet

More Stories on : Letters | Taxation

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
The oil burden

Copyright © 2007, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line