Looking merely at direct taxes, it is often suggested that India is an under-taxed nation. This, says R. Vaidyanathan, does not take into account the speed money paid for government service. This rent-seeking makes the nation high-taxed.

THERE is a view among some experts that India is an under-taxed economy. Many a time Finance Ministers believe in this and exhort people to pay their dues.

Advertisements are issued to induce people to pay taxes and novel schemes are suggested before every Budget to augment government revenues. One of the common arguments is based on the share of taxes to GDP and it is suggested that it can be much higher. Another is in terms of the composition of the taxes - direct and indirect - and it is suggested that the latter, which are regressive, are larger share of the pool.

Table 1 gives the share of taxes to GDP for select years from 1991. The share of taxes, both direct and indirect, has been around 15 per cent of GDP in the last decade and half. The share of indirect taxes was of the order of 11.5 per cent and that of direct taxes 3.6 per cent.

Based on this data of direct taxes to GDP of nearly 4 per cent, many experts, particularly of the Left persuasion, argue that we are a under-taxed nation from the view of the direct taxes. But, as we will show, they do not take in to account the payment to be made to government employees (variously called bribe, rent seeking, speed money, lubrication, etc.) for carrying on any activity and to that extent the total taxes are much higher than reflected.

Table 2 gives the level and composition of taxes of both Central and State governments in the last decade. A slight shift in the proportion of direct taxes from 1991 to 2003 is seen. It has gone up from 14 per cent of all taxes to nearly 24 per cent during this period when the proportion of the indirect taxes came down from 86 per cent to 76 per cent.

A substantial drop is seen in the Customs duties due to our international commitments. Excise duties declined from 28 per cent to 23 per cent during 1991 to 1996 and by a similar magnitude later. The share of personal income-tax showed an increase from 6.6 per cent to 9.9 per cent. As personal income-taxes and excise duties are shared with State governments, there is no enthusiasm for the Centre to reform them.

The aggregate taxes do not reveal the full picture of evasion and coverage. Table 3 provides the number of returns filed by salaried and non-salaried persons in 1999-2000 according to the I-T Department.

It says that there were no salaried persons earning more than Rs 1 crore annually and in all only 200 persons above Rs 25-lakh. In the case of self-employed, the number is around 900 in the Rs 25-lakh category with none in the Rs 50-100-lakh category.

From Table-3, it looks as if a relief fund should be created for all our top film-stars, cricket players, surgeons, lawyers, chartered accountants, architects, tax consultants and other self-employed persons. They all seem to be in distress!

Table 4 provides the number of returns from some categories of services as published by the I-T Department. The numbers speak volumes about the coverage and the nature of underlying collections.

The whole country there are apparently only 10,539 utensil and 5477 furniture shops in the taxable category. Pinch yourself.

Immediately the argument will be to strengthen, enhance, improve and network the I-T Department. The issue is not that. It is much more serious and cancerous. If you visit the Postal Department officers’ quarters in, say, Mumbai you will find mostly cycles and scooters.

But if you visit the residential quarters of the staff of Direct or Indirect Tax Department, you may find expensive cars parked there. That should provide clues to the issues facing us.

At the same time we find that the income of government employees rising faster than the inflation rate in the last thirty years.

Table 5 provides the increase in salaries of public sector employees in relation to inflation. The emoluments have risen 3610 per cent from 1971-72 to 2000-01 when the Consumer Price Index climbed 1440 per cent. This implies the public sector employees are net gainers with their real income well protected.

Hence decline in the real income cannot be a reason, if at all it is justifiable, for rent seeking from ordinary citizens.

Hewlett-Packard announced India, the development of its campus on the Move “initiative today to promote their products and solutions portfolio, under the earth the first educational institutions.

As part of the initiative, HP, while running a series of roadshows, including coverage of the main cities of New Delhi, Mumbai, Pune, Chennai, Bangalore, Hyderabad, Salem, Trichy and other regions.

Talking about the initiative, P Raghuraman, Country Manager - Business Notebooks, Hewlett Packard, India said: “We agree with HP, the gap between what industry and academia who teach. Thanks to our success “Campus on the Move” initiative, we hope that with major universities across the country, improvement of school curricula so that they can to meet the needs of industry. ”

Under this initiative, HP offers the retail window for educational institutions for the implementation of information technology infrastructure, laptops, desktops and workstations, simple option of leasing measure After-Sales and Support. Many institutions have benefited from the implementation of “Campus with a wireless laptop with students to learn from anywhere on campus.

In recent years one of laptops, HP has delivered some of the most prestigious institutions such as symbiosis of India, Wellingkar, Manipal, Amity Business School, IIPM, Kalinga, Xavier’s Institute of Management, Sri Mahavir Jain, etc.

Hewlett-Packard, India’s Roll-out “Campus on the Move” initiative for the year 2006 to promote its products and solutions portfolio in the country schools.

As part of the “Campus on the Move ‘, HP, while running a series of roadshows, including coverage of the cities of New Delhi, Mumbai, Pune, Chennai, Bangalore, Hyderabad, Salem and Trichy, among others.

Under this initiative, HP offers the retail window for educational institutions for the implementation of information technology infrastructure, laptops, desktops and workstations, simple option of leasing measure After-Sales and Support. Many institutions have benefited from the implementation of “Campus with a wireless laptop with students to learn from anywhere on campus.

P. Raghuraman, Country Manager, Business HP laptops, India, said: “We at HP, recognizes the gap between what industry and academia who teach. Thanks to our success,” Campus on the Move “initiative we hope to reach a major universities across the country, improvement of school curricula so that they can to meet the needs of industry. ”

In recent years one of laptops, HP has delivered some of the most prestigious institutions in India, as symbiosis, Wellingkar, Manipal, Amity Business School, IIPM, Kalinga, Xavier’s Institute of Management, Sri Mahavir Jain, etc.

Verghese Manoirs shepherd threatened to step in the direction of the Institute of Rural Management, Anand, after another tussle with a time protected, National Dairy Development Board (NDDB) Chairman Amrita Patel.

The threat to end IRMA, an institute founded by him, came to a horrible duel IRMA during a meeting, as director of the Institute, Prathap Reddy, according to reports questioned the validity of his activity as president.

Reddy wanted to discuss a legal assistant for the charity by the Commissioner of Nadiad that recalled that the president can not hold office for more than two years.

IRMA was founded in 1979 to create, manager for rural development and village cooperatives, the operation was carried out under Flood.

The sources indicate Reddy, is located nearby, that Patel, the question of the meeting decided to set up an investigation of three members of the committee probe charges of irregularities against him.

This, said sources, Manoirs angry, said he wants to. It was only after he had convinced other members of the committee it calms down.

More than 10 members of the Board of 15 members attended the coverage. Sources said the meeting had been convened at the insistence of some members, a circular wanted to discuss the resolution authorizing the president of the cessation of the director, on the basis of accusations.

Executive Assistant Manoirs, PA Joseph, said in an e-mail reply that, according to the memorandum of IRMA Association, while the president and three other members, the Governing Council - representatives of NDDB, the Indian government and the Government of Gujarat - were elected for a term of five years in the year 1979, the term was later extended by three years.

Thereafter, the four received a “duration”. “This clause is questionable. We would like to know if this amendment to the Constitution to give IRMA Manoirs unlimited duration has been ratified by the charity commissioner and the board,” said one board member and do not want to be cited.

Sources also say that it was a result of a Knatsch between Manoirs and Patel on the issue of cooperatives