Economic redistribution: Who’s afraid of progressive taxes?

livemint.com:

₹500 crore was 19%, while those with profits of less than ₹1 crore paid an effective tax rate of 25%. The corporate tax break awarded in 2019 helped companies increase profits even though consumption and private investment hardly witnessed any acceleration.

For a country with significant deprivations of nutrition, education and health, and with stagnant incomes for most people, generating resources to subsidize the poor is not a choice, but a necessary instrument of governance. However, despite significant deficits, government spending on essential public services such as education and health remains low, with a real decline over the years.

The inability of successive governments to spend adequately on these essential public services is attributable not just to a lack of political will, but also of resources. Our tax-to-GDP ratio is among the lowest among middle- income countries, with almost no increase in the last three decades.

This happened despite average economic growth of above 6% annually. An effective tax policy that’s truly progressive in application is necessary to fund essential public services.