Market Watch

Why high income tax rates are so unjust in India

Govt's justificationAgencies
Govt's justification
It’s true, there are countries where the super rich pay even higher taxes than they do in India.

The government used this to justify the higher taxes that those earning above Rs 2 crore will now have to pay.
Missing link
But there was something it did not mention: most high-tax countries invest heavily to finance free education and healthcare along with various social security schemes. That doesn’t quite hold true for India.
On education frontBCCL
On education front
According to a 2018 UK government report, of the total 87.4 lakh primary and secondary students enrolled in the country, 91.3% were studying in government schools.

World Bank data shows that in 2016, enrolment in private schools at the primary level was 15% in France and 9% in Canada. This was 33% in India.
At secondary levelBCCL
At secondary level
At the secondary level, 25% of French students were enrolled in private schools while this was 8% in Canada.

In India, this was 51%. And the only reason this is so is because there aren’t enough good government schools in India. As a result, the taxpayer is not only paying taxes, but also paying large sums for her child’s education.
Some comparisonBCCL
Some comparison
World Bank data shows that the Indian government’s spend on education as a proportion of GDP is much lower than many high-tax countries.
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