Mains Examination: General Studies-II: Appointment to various Constitutional posts, powers, functions and responsibilities of various Constitutional Bodies.
General Studies-III: Indian Economy and issues relating to planning, mobilisation, of resources, growth, development, and employment.
What’s the ongoing story: The Goods and Services Tax (GST) Council in its 55th meeting held in Jaisalmer Saturday deferred a decision to lower the tax rate on health and life insurance premiums, and food delivery charges of e-commerce aggregators such as Swiggy and Zomato. It also discussed inclusion of Aviation Turbine Fuel (ATF) under GST, but deferred a decision since most states were not in favour of losing their right to tax it.
Key Points to Ponder:
— What is the purpose of introducing GST?
— What is the composition of the GST Council?
— What are the constitutional provisions related to the GST?
— How is tax shared among the center and the state?
— What is the difference between cess and surcharge?
— How is the GST an example of Cooperative federalism?
Key Takeaways:
— The Council discussed the tax rate on ready-to-eat popcorn, which is mixed with salt and spices. It took the view and clarified that popcorn with salt and spices has the essential character of a namkeen and should face 5 per cent GST (other than pre-packaged and labelled). — The GST should be 12 per cent if the popcorn is pre-packaged and labelled. When mixed with sugar (e.g. caramel popcorn), it was akin to sugar confectionery items (items with ‘added sugar’) and hence, would attract 18 per cent GST.
— The Group of Ministers (GoM) on rate rationalisation sought more time to discuss the proposal to tweak rates on as many as 148 items, which will also come up for discussion in the Council later. The GoM for compensation cess was also given an extension by the Council to submit its recommendations.
— For taxation of used electric vehicles, the GST Council recommended a harmonisation of the GST rate on sale of old and used vehicles including EVs at 18 per cent. Sitharaman said the Council decided to raise the rate of tax to 18 per cent from 12 per cent on all used EV sales, just as in case of non-electric vehicles.
— In other key rate changes, the GST Council recommended that no GST will be payable on penal charges levied and collected by banks and NBFCs from borrowers for non-compliance with loan terms, or in other words, loan defaults.
— A special demand by Andhra Pradesh to discuss levy of 1 per cent additional GST over and above the topmost 28 per cent rate in case of disasters, broadly on the lines of flood cess levied by Kerala in 2019, was discussed in the Council. The GST Council agreed to refer this discussion for a special levy for disasters to a GoM.
Do You Know:
— The GST regime came into force after the Constitutional (122nd Amendment) Bill was passed by both Houses of Parliament in 2016. More than 15 Indian states then ratified it in their state Assemblies, after which then-President Pranab Mukherjee gave his assent.
— It came into effect in 2017 and was billed as an attempt to simplify the existing tax structure in India, where both the Centre and states levied multiple taxes, and to make it uniform.
— The President set up the GST Council as a joint forum of the Centre and the states, under Article 279A (1) of the amended Constitution. It said that members of the Council include the Union Finance Minister (chairperson), and the Union Minister of State (Finance) from the Centre. Each state can nominate a minister in charge, of finance or taxation or any other minister, as a member.
— According to Article 279, the GST council is meant to “make recommendations to the Union and the states on important issues related to GST, like the goods and services that may be subjected or exempted from GST, model GST Laws”. It also decides on various rate slabs of GST, whether they need to be modified for certain product categories, and so on.
Other Important Articles Covering the same topic:
📍Explained: What is the GST Council, and what does it do?
Previous year UPSC Prelims Question Covering similar theme:
(1) What is/are the most likely advantages of implementing ‘Goods and Services Tax (GST)’? (UPSC CSE 2017)
1. It will replace multiple taxes collected by multiple authorities and will thus create a single market in India.
2. It will drastically reduce the ‘Current Account Deficit’ of India and will enable it to increase its foreign exchange reserves.
3. It will enormously increase the growth and size of the economy of India and will enable it to overtake China in the near future.
Select the correct answer using the code given below:
(a) 1 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3
Previous year UPSC Mains Question Covering similar theme:
Enumerate the indirect taxes which have been subsumed in the goods and services tax (GST) in India. Also, comment on the revenue implications of the GST introduced in India since July 2017. (2017)
US court holds Israeli company NSO liable for targeting WhatsApp users
Syllabus:
Preliminary Examination: Current events of national and international importance
Mains Examination: General Studies-III: Challenges to internal security through communication networks, role of media and social networking sites in internal security challenges, basics of cyber security; money-laundering and its prevention.
What’s the ongoing story: In a significant ruling on Friday, a United States District Court held Israeli technology company NSO Group liable for targeting the devices of 1,400 WhatsApp users. NSO Group is the maker of the Pegasus spyware allegedly used by its government clients to infect the devices of several WhatsApp users, including activists, journalists, and other members of the civil society.
Key Points to Ponder:
— What is the purpose of spyware, particularly Pegasus?
— What about the rights of individuals whose phones were hacked?
— What are the cyber security laws in India?
— What are the various cyber security threats?
— What are the cyber security mechanisms in India?
— Why did the spyware tool Pegasus become the news in India?
Key Takeaways:
— The case now moves the deliberations to determine damages NSO owes WhatsApp, which is set to begin on March 3, 2025, in Oakland, California. The ruling, however, does not address the rights of individuals whose phones were hacked.
— Friday’s ruling came five years after the Meta-owned WhatsApp sued the NSO Group in the US District Court of North California in October 2019.
— In its ruling, the court concluded that in exploiting a bug in WhatsApp, NSO Group had violated sections of the Computer Fraud and Abuse Act (CFAA), a federal cybersecurity law that criminalises unauthorised access to computers, networks and other digital information, and a similar state law in California called the California Computer Data Access and Fraud Act (CDAFA).
— It also ruled in WhatsApp’s favour over its claim that the NSO Group had violated its terms of service, handing the messaging app a decisive victory.
— This is significant, given that no prior court had held NSO Group liable for its spyware. As The Indian Express reported in November using unsealed court documents, WhatsApp alleged that between April 2018 and May 2020, the NSO Group had reverse-engineered and decompiled its source code to create installation vectors (points of entry) named “Heaven”, “Eden” and, “Erised”—all part of a sophisticated hacking suite called “Hummingbird” that NSO Group sold to its government clients.
— Critically, the ruling rejects NSO Group’s oft-quoted defence that it wasn’t liable for its clients’ – governments that acquired the spyware — actions and decisions on how they deployed it.
— NSO admitted that the installation of Pegasus through WhatsApp was indeed a matter for “NSO and the system to take care of, not a matter for clients to operate.”
Do You Know:
— WhatsApp, which is owned by Facebook, is the world’s most popular messaging app, with more than 1.5 billion users worldwide. About a quarter of those users — more than 400 million, or 40 crore — are in India, WhatsApp’s biggest market.
— The NSO Group is a Tel Aviv-based cyber-security company that specialises in “surveillance technology” and claims to help governments and law enforcement agencies across the world fight crime and terrorism.
— All spyware do what the name suggests — they spy on people through their phones. Pegasus works by sending an exploit link, and if the target user clicks on the link, the malware or the code that allows the surveillance is installed on the user’s phone. Once Pegasus is installed, the attacker has complete access to the target user’s phone.
— Once the phone is exploited and Pegasus installed, it begins contacting the operator’s command and control servers to receive and execute operator commands, and send back the target’s private data, including passwords, contact lists, calendar events, text messages, and live voice calls from popular mobile messaging apps. The operator can even turn on the phone’s camera and microphone to capture activity in the phone’s vicinity.
— In 2021, it was reported that Pegasus was used on more than 300 Indian mobile numbers, including that of two serving ministers in the Narendra Modi government, three Opposition leaders, one constitutional authority, several journalists and business persons.
Other Important Articles Covering the same topic:
📍Pegasus: 300 of 1,400 users from India, why ruling may re-open tapping debate
📍Explained: What is Israeli spyware Pegasus, which carried out surveillance via WhatsApp?
Previous year UPSC Prelims Question Covering similar theme:
(2) The terms ‘WannaCry, Petya and EternalBlue’ sometimes mentioned in the news recently are related to (UPSC CSE 2018)
(a) Exoplanets
(b) Cryptocurrency
(c) Cyber attacks
(d) Mini satellites
Previous year UPSC Mains Question Covering similar theme:
What are the different elements of cyber security? Keeping in view the challenges in cyber security, examine the extent to which India has successfully developed a comprehensive National Cyber Security Strategy. (UPSC CSE 2022)
Govt amends poll rules to restrict public inspection of electronic records
Syllabus:
Preliminary Examination: Indian Polity and Governance – Constitution, Political System, Panchayati Raj, Public Policy, Rights Issues
Mains Examination: General Studies-II: Statutory, regulatory and various quasi-judicial bodies
What’s the ongoing story: The Union Government Friday amended the Conduct of Election Rules to limit public inspection of election papers to only those documents specified in the provisions.
Key Points to Ponder:
— What are the Conduct of Election Rules?
— What is the role of the Election Commission of India?
— What is the Form 17C?
— What are the reasons for amending the poll rules by the government?
— How is the public trust in the election process maintained?
— What are the government’s arguments against the sharing of electronic records?
— What is the issue of violation of the secrecy of the vote?
Key Takeaways:
— This amendment, sources in the government told The Sunday Express, would effectively clarify that electronic footage of the polling process is not covered within the definition of election papers and, hence, not open to public scrutiny.
— Earlier, Rule 93 (2) (a) of the 1961 Conduct of Election Rules stated that “all other papers relating to the election shall be open to public inspection”.
— The amended version of the rule now states: “all other papers as specified in these rules relating to the election shall be open to public inspection.”
— Now, only election papers mentioned under different provisions of the Conduct of Election Rules (like nomination papers) would be open to public scrutiny. Papers available to candidates, like Form 17C, continue to remain available to them. The tweak would effectively exclude CCTV footage or any electronic record of the poll process from public inspection.
— However, the tweak has been justified on the ground that public inspection of election papers does not include videography and CCTV footage.
— Moreover, providing CCTV footage, the official said, would amount to a violation of secrecy of vote and open it up to potential misuse using artificial intelligence.
Do You Know:
— The Election Commission of India (ECI) is a permanent, independent, and constitutional authority responsible for conducting free and fair elections in the Union and the States of India.
— The ECI is empowered to supervise, oversee, and manage elections to Parliament, state legislatures, and the offices of President and Vice President of India. Since the ECI does not oversee elections to state-level urban bodies like municipalities and panchayats, there is a separate State Election Commission.
— The Constitution has the following articles (Articles 324–329) to empower the Election Commission and provide insight into the potential roles and functions of the commission.
Other Important Articles Covering the same topic:
📍Election Commission of India: Composition, powers and functions
Previous year UPSC Prelims Question Covering similar theme:
(3) Consider the following statements: (UPSC CSE 2017)
1. The Election Commission of India is a five-member body.
2. Union Ministry of Home Affairs decides the election schedule for the conduct of both general elections and bye-elections.
3. Election Commission resolves the disputes relating to splits/mergers of recognised political parties.
Which of the statements given above is/are correct?
(a) 1 and 2 only
(b) 2 only
(c) 2 and 3 only
(d) 3 only
Previous year UPSC Mains Question Covering similar theme:
Discuss the role of the Election Commission of India in the light of the evolution of the Model Code of Conduct. (UPSC CSE 2022)
GOVT & POLITICS
‘Contributing to talent, tech and tradition’: PM Modi hails Indian diaspora in Kuwait
Syllabus:
Preliminary Examination: Current events of national and international importance
Mains Examination: General Studies-II: Effect of policies and politics of developed and developing countries on India’s interests, Indian diaspora.
What’s the ongoing story: Calling Kuwait an important trade and energy partner, a day ahead of his bilateral meetings with the Emir and Crown Prince of the Gulf nation, Prime Minister Narendra Modi also highlighted the role of the Indian diaspora in the country in terms of “talent, technology and tradition”.
Key Points to Ponder:
— What is diaspora and highlight its significance?
— Why is Modi’s visit to Kuwait significant?
— What is the potential of the India-Kuwait relationship?
— What is the significance of Gulf countries?
— Map work: Location of Kuwait
Key Takeaways:
— Addressing a large gathering of the Indian community in Kuwait in a special event ‘Hala Modi’ at the Sheikh Saad Al-Abdullah Indoor Sports Complex, Modi said, “The relationship that culture and commerce had built in the past is moving towards new heights in the new century…”
— This is the first visit by an Indian PM in 43 years, and it will undoubtedly strengthen the India-Kuwait friendship across various sectors,” Modi said in a post on X.
— At a time when the tension in West Asia is still simmering, Modi also said that India and Kuwait have a “shared interest in peace, security, stability and prosperity in the West Asia region”. His visit to Kuwait is taking place two weeks after the collapse of President Bashar al-Assad’s regime in Syria and the continuing Israeli offensive in Gaza.
— Modi said his talks with top Kuwaiti leadership would be an opportunity to chalk out a roadmap for a futuristic partnership with India.
— On Sunday, PM Modi will be accorded a ceremonial guard of honour at the Bayan Palace (Emir’s palace), following which he will hold separate meetings with the Emir of Kuwait and the Crown Prince of Kuwait Sabah Al-Khalid Al-Sabah.
— Prime Minister Narendra Modi was awarded the ‘Order of Mubarak Al Kabeer’, the highest honour in Kuwait, by Amir of Kuwait Sheikh Meshal Al-Ahmad Al-Jaber Al Sabah Sunday. This is the 20th international honour bestowed on Modi.
Do You Know:
— India and Kuwait share robust economic ties. Kuwait ranks as one of India’s top trading partners, with bilateral trade valued at USD 10.47 billion in the financial year 2023-24. The Gulf nation is also India’s sixth-largest crude oil supplier, meeting 3 percent of its energy needs.
— Indian exports to Kuwait have reached a record USD 2 billion, while investments by the Kuwait Investment Authority in India exceed USD 10 billion.
— The Indian community, which forms the largest expatriate group in Kuwait, plays a vital role in strengthening bilateral relations. With over one million Indians making up 21 percent of Kuwait’s population and 30 percent of its workforce, their contribution spans various sectors, including the private and domestic workforce.
— The historical ties between India and Kuwait date back to the pre-oil era when maritime trade formed the backbone of Kuwait’s economy. This visit seeks to further deepen the longstanding friendly relations between the two nations.
Other Important Articles Covering the same topic:
📍PM Modi awarded Kuwait’s highest honour
📍PM Modi arrives in Kuwait on 2-day visit
Previous year UPSC Prelims Question Covering similar theme:
(4) Which of the following is not a member of ‘Gulf Cooperation Council’? (UPSC CSE 2016)
(a) Iran
(b) Saudi Arabia
(c) Oman
(d) Kuwait
India lost dense forests, gained tree cover, says Govt report
Syllabus:
Preliminary Examination: General issues on Environmental Ecology, Biodiversity and Climate Change – that do not require subject specialisation
Mains Examination: General Studies-III: Conservation, environmental pollution and degradation, environmental impact assessment.
What’s the ongoing story: The biennial India State of Forest Report (ISFR 2023) released by Environment Minister Bhupender Yadav on Saturday in Dehradun reported a net gain of 156 sq km in India’s forest cover and 1,289 sq km in tree cover since 2021. It also recorded a complete loss of 3,656 sq km of dense forests at that time.
Key Points to Ponder:
— Who prepares the India State of Forest Report?
— What is the significance of carrying out this report?
— Make a comparison of key highlights of ISFR 2021 and ISFR 2023.
— What is the difference between forest and tree cover according to the ISFR?
— What steps have been taken by the government to conserve forests?
Key Takeaways:
— Tree patches smaller than 1 hectare are not considered forests and are accounted for separately as tree cover. At 1,12,014 sq km, India’s tree cover now extends over 3.41% of the land area and supplements India’s 21.76% forest cover.
— Releasing the report, Minister Yadav expressed happiness over the fact that as compared to 2021, there is an increase of 1,445 sq km in the total forest and tree cover of the country.
— He also highlighted the near real-time fire alerts and forest fire services provided by FSI using advanced technology.
— The top four states that recorded the maximum increase in forest and tree cover are Chhattisgarh (684 sq km) followed by Uttar Pradesh (559 sq km), Odisha (559 sq km) and Rajasthan (394 sq km).
— The four states that recorded the maximum loss in forest and tree cover between 2021 and 2023 are Madhya Pradesh (612.41 sq km), Karnataka (459.36 sq km), Ladakh (159.26 sq km) and Nagaland (125.22 sq km).
— When it comes to gain in forest cover alone, Mizoram (242 sq km), Gujarat (180 sq km) and Odisha (152 sq km) topped the chart. Incidentally, Odisha was one of the top gainers in ISFR 2021 as well.
— As many as 21 states and UTs have shown an increasing trend in tree cover, which indicates agroforestry promotion, with Chhattisgarh (702.75 sq km) Rajasthan (478.26 sq km) and Uttar Pradesh (440.76 sq km) in the lead.
— In terms of quality (canopy density), India’s forests are classified under three categories: very dense forest (VDF) with a 70% or higher canopy density, moderate dense forest (MDF) with 40-70% canopy density and open forest (OF) with less than 40% canopy density.
— According to the latest ISFR, 294.75 sq km of VDF and 3,361.5 sq km of MDF became non-forests during 2021-2023 in India. Together, that is a loss of 3,656 sq km of dense forests in two years.
— ISFR 2023 carried out a decadal changes analysis of forest cover of Western Ghats Eco-Sensitive Areas and recorded an overall loss of 58.22 sq km in forest cover since 2013. In that time, the landscape gained 3,465.12 sq km in VDF while MDF and OF decreased by 1,043.23 sq km and 2,480.11 sq km respectively.
— Since 2021, the country’s mangrove cover shrunk by 7.43 sq km with Gujarat recording the biggest loss of 36.39 sq km. However, Andhra Pradesh (13.01 sq km) and Maharashtra (12.39 sq km) recorded notable gains in mangroves.
Other Important Articles Covering the same topic:
Previous year UPSC Prelims Question Covering similar theme:
(5) Consider the following States: (UPSC CSE 2019)
1. Chhattisgarh
3. Maharashtra
4. Odisha
With reference to the States mentioned above, in terms of percentage of forest cover to the total area of State, which one of the following is the correct ascending order?
(a) 2-3-1-4
(b) 2-3-4-1
(c) 3-2-4-1
(d) 3-2-1-4
Why Road Ministry is planning to deploy AIMC system for National Highways construction
Syllabus:
Preliminary Examination: Current events of national and international importance
Mains Examination: General Studies-III: Science and Technology- developments and their applications and effects in everyday life.
What’s the ongoing story: Given the concerns over delays in the completion of many National Highway projects across the country, the Ministry of Road Transport & Highways (MoRTH) has expedited the use of Automated & Intelligent Machine-aided Construction (AIMC) system.
Key Points to Ponder:
— What is the significance of the AIMC system?
— How government is deploying intelligence machines for NH construction?
— How Artificial Intelligence is being in the governance process?
— How AI can be deployed in the digital public infrastructure?
— What are the challenges of using AI in the governance process?
Key Takeaways:
— This will provide real-time data on the status of each project, with a survey going hand-in-hand with construction at every stage of the road-building process. The generated data will be sent on a real-time basis to stakeholders, including the MoRTH.
— The Ministry earlier this week issued a draft circular to all the stakeholders including National Highway Authority of India (NHAI), and the National Highways & Infrastructure Development Corporation Limited (NHIDCL), seeking their comments and suggestions on the adoption of AIMC in National Highway projects.
— The introduction of various kinds of machinery for highway construction greatly expedited the process. Now, with the rise of Artificial Intelligence (AI), we are at the cusp of another revolution.
— A number of “intelligent road construction machines” have been developed, which will enhance the durability & longevity of roads constructed, provide real time documentation, and increase productivity. Such machines will help completion of projects as per precise schedules.
— NHAI is implementing AIMC on a pilot basis in the 63-km long under-construction Lucknow-Kanpur Expressway Project, also known as the Awadh Expressway, where automated & intelligent machines such as GPS-aided motor grader, intelligent compactor, and stringless paver have been used.
— Recently, while responding to a question by a member of Rajya Sabha, Union Minister of Road Transport and Highways Nitin Gadkari said that out of 952 projects (including National Highway projects) costing more than Rs 150 crore which were under construction in March 2024, a total of 419 projects spilled beyond their original completion schedule, missing one or the other of the various stages of project completion.
— Road projects require embankment, subgrade, subbase, and base pavement layers. Under the AIMC system, a GPS-aided motor grader will be used for earthworks, subbase & base layers, and an intelligent compaction roller (IC roller) and Single Drum/Tandem Vibratory Roller will be used for soil, subbase and base layer compaction.
— GPS-aided motor grader, also called 3D machine control technology, will process the data from Global Navigation Satellite System (GNSS), and an angle sensor. It will calculate the precise position and orientation of the grader’s blade in real-time and compare it to the desired design surface or grade specified in the digital design plans.
— India presently has about 1.46 lakh km in its National Highways network. Out of this network, about 3,000 km comprises high-speed corridors — with a vision to construct a further 45,000 km till 2047.
Do You Know:
— The Ministry of Road Transport and Highways (MoRTH) has amended the National Highways Fee (Determination of Rates and Collection) Rules, 2008 to include provisions relating to GNSS-based electronic toll collection.
— GNSS will allow toll or highway user fees to be collected without stopping the vehicle at a toll booth boom barrier in order for the FASTag barcode to be read.
— GNSS-based tolling is likely to be implemented in April 2025, and is intended to eventually replace FASTag for toll collection on highways. The movement of the vehicle will be tracked by satellite, and users will pay toll only for the distance they have travelled, rather than the fixed amounts for set distances that they pay now.
Other Important Articles Covering the same topic:
📍GNSS: How the new satellite-based highway toll collection system will work
📍Rajeev Chandrasekhar writes: It’s time for the age of GovAI — reimagining governance with AI
Previous year UPSC Mains Question Covering similar theme:
The emergence of the Fourth Industrial Revolution (Digital Revolution) has initiated e-Governance as an integral part of government”. Discuss. (UPSC CSE 2020)
OPINION
Lessons from the past: Why a wealth tax may not be a rich idea
Syllabus:
Preliminary Examination: Current events of national and international importance
Mains Examination: General Studies-III: Indian Economy and issues relating to planning, mobilisation, of resources, growth, development and employment.
What’s the ongoing story: Ishan Bakshi writes: Taxing wealth is not a recent phenomenon. The canton of Basel City in Switzerland had introduced such a tax way back in 1840*. The Netherlands began to impose the tax in 1892. Sweden in 1911. In India, T T Krishnamachari, minister of finance, introduced the wealth tax in 1957. Several other countries also levied the tax.
Key Points to Ponder:
— What is a wealth tax?
— What are the arguments for and against the imposition of wealth tax?
— What is the current status of wealth tax in India?
— What are the administrative difficulties in imposing wealth tax?
— What is inheritance tax?
Key Takeaways:
— In recent years, however, there appears to be a renewed conversation on taxing wealth. Soaking the rich, after all, has enduring appeal.
— In their recent study on India, Thomas Piketty and his co-authors have documented a sharp rise in inequality in India over the past decades — a rise that appears to be more pronounced post 2014-15.
— As per their analysis, the top 1% accounted for 22.6% of income and 40.1% of wealth in 2022-23. These estimates place the income share of the top 1% in India even higher than that in South Africa, Brazil and the US.
— Juxtapose the gains made by the top 1% against the meagre earnings of those at the lower ends of the income distribution who are dependent on state programmes and schemes and the appeal of such taxes becomes obvious, especially as only a minuscule percentage of the population is likely to be affected by it.
— Such a tax, it is argued, would raise more resources which could be used to provide greater support to the poor while also addressing concerns over rising inequality and progressivity of the tax system.
— Piketty and his co-authors have argued in favour of imposing a 2% annual tax on net wealth exceeding Rs 10 crore and a 33% inheritance tax on estates in excess of Rs 10 crore.
— Such taxes are difficult to implement. They entail high administrative costs, can lead to excessive litigation and tend to raise very little revenue — the rich have always found creative ways of gaming the system.
— In 1985, when V P Singh abolished the estate duty, or the inheritance tax as it was then known, he acknowledged that the cost of administering it was “relatively high”and the revenue collected was “only about Rs 20 crore”.
— Since the time there have been taxes, there have been those trying to evade them. A papyrus from ancient Egypt (7th century BCE) reveals the story of a man who was transferring his property to his children at a conservative value. His objective was simple — to evade the inheritance tax.
— In today’s globalised world, with few restrictions on the mobility of capital, there is also the very real possibility that high rates of taxation will simply result in the rich leaving the country, opting instead to settle and conduct their business from cities such as Dubai.
— The risk of capital flight is not an exaggerated, trivial concern. Various reports suggest that after Norway increased its wealth tax, many high net worth individuals left the country. India has also been experiencing a flight of the rich.
— Moreover, a large part of wealth in India, and as a consequence a person’s inheritance, is in the form of land, real estate and gold. Will these have to be liquidated? India’s story of wealth creation has just started. Millions are only now beginning to take part in this journey. Levying such taxes will only take us back to our socialist past.
Do You Know:
— According to Investopedia, a wealth tax, also called capital tax or equity tax, is imposed on the wealth possessed by individuals. The tax usually applies to a person’s net worth, which is assets minus liabilities. These assets include (but are not limited to) cash, bank deposits, shares, fixed assets, personal cars, real property, pension plans, money funds, owner-occupied housing, and trusts.
— The Government of India set up the Kaldor Committee in 1955 to rationalise the tax system and bring about affirmative reforms.
—Pursuant to the suggestions made by the Kaldor Committee, the Government delineated a plan for a composite and integrated tax structure to ensure that no income or wealth escaped assessment.
—Thus, the Wealth Tax Act (WTA) was introduced in 1957 as a permanent measure. It was abolished in 2015 due to several procedural difficulties such as extensive litigation, increased compliance burdens, heavy administration costs and generation of inadequate revenues.
Other Important Articles Covering the same topic:
📍Wealth tax in India will boost economic growth — roadblock is political will
📍French economist Thomas Piketty calls for more detailed income tax data from India
Previous year UPSC Prelims Question Covering similar theme:
(6) In the context of any country, which one of the following would be considered as part of its social capital? (UPSC CSE 2019)
(a) The proportion of literates in the population
(b) The stock of its buildings, other infrastructure and machines
(c) The size of population in the working are group
(d) The level of mutual trust and harmony in the society
| PRELIMS ANSWER KEY |
| 1. (a) 2. (c) 3. (d) 4. (a) 5. (c) 6. (d) |
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