Corruption in high places is a malaise that is easy to diagnose but difficult to cure. Even in the rare cases they are arraigned before a court, top politicians often pay their way through legal battles, and spend little or no time in incarceration.
And as with the churning, it is evident (as in case of the mystical ‘Samudra Manthan – ‘Churning of the sea’)‘ that there will be at least two significant byproducts- one is of the “nector” and one is of the “poison”. Which is what- only the time will tell as the political sea of Tamilnadu keeps on chruning.
The conviction of AIADMK general secretary V.K. Sasikala in the disproportionate assets case involving her close friend, former Chief Minister Jayalalithaa, as the prime accused, is a significant marker in India’s legal and political history.
The charges against Jayalalithaa abated following her death last December, but Ms. Sasikala had to face the full wrath of the Supreme Court, which has upheld the trial court order in toto, leaving her to spend four years in prison.
As Justice Amitava Roy wrote in his concurring order, “corruption is a vice of insatiable avarice for self-aggrandisement by the unscrupulous, taking unfair advantage of their power and authority.”
While there is no denying that the judgment has strengthened confidence in the justice delivery system, it is mystifying that the ruling has come more than eight months after the two-member Bench concluded hearing arguments in the case.
All the more so, since the basic thrust of the judgment only endorsed the position taken by the trial court in Bengaluru, which held all the accused in the case guilty. Given that the Supreme Court had pressed the Karnataka High Court to hear the appeal expeditiously, there was no justification in such an inordinate delay.
Politically, this could not have come at a worse time for Ms. Sasikala, who was making a determined bid for power, staking claim to form the government after displacing one-time loyalist O. Panneerselvam.
Governor Ch. Vidyasagar Rao had held off inviting Ms. Sasikala to form the government despite her demonstrating the support of a majority of the members of the legislature precisely because he anticipated such a situation.
Now, however, the options before him are a lot clearer. If the newly elected leader of the AIADMK Legislature Party, Edappadi Palaniswami, is able to show the support of at least 117 MLAs, he will have to be sworn in as Chief Minister.
Though there are allegations that the MLAs were kept forcibly at a resort by the Sasikala camp, Mr. Panneerselvam is nowhere close to splitting the AIADMK legislature party despite the support of the rank and file. Notwithstanding the legal setback, Ms. Sasikala may be able to trump Mr. Panneerselvam politically. But her success in keeping the MLAs together may depend on the Governor’s next move; whatever that is, Tamil Nadu is destined for more political churn.
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Petrol in India is cheaper than in countries like Hong Kong, Germany and the UK but costlier than in China, Brazil, Japan, the US, Russia, Pakistan and Sri Lanka, a Bank of Baroda Economics Research report showed.
Rising fuel prices in India have led to considerable debate on which government, state or central, should be lowering their taxes to keep prices under control.
The rise in fuel prices is mainly due to the global price of crude oil (raw material for making petrol and diesel) going up. Further, a stronger dollar has added to the cost of crude oil.
Amongst comparable countries (per capita wise), prices in India are higher than those in Vietnam, Kenya, Ukraine, Bangladesh, Nepal, Pakistan, Sri Lanka, and Venezuela. Countries that are major oil producers have much lower prices.
In the report, the Philippines has a comparable petrol price but has a per capita income higher than India by over 50 per cent.
Countries which have a lower per capita income like Kenya, Bangladesh, Nepal, Pakistan, and Venezuela have much lower prices of petrol and hence are impacted less than India.
“Therefore there is still a strong case for the government to consider lowering the taxes on fuel to protect the interest of the people,” the report argued.
India is the world’s third-biggest oil consuming and importing nation. It imports 85 per cent of its oil needs and so prices retail fuel at import parity rates.
With the global surge in energy prices, the cost of producing petrol, diesel and other petroleum products also went up for oil companies in India.
They raised petrol and diesel prices by Rs 10 a litre in just over a fortnight beginning March 22 but hit a pause button soon after as the move faced criticism and the opposition parties asked the government to cut taxes instead.
India imports most of its oil from a group of countries called the ‘OPEC +’ (i.e, Iran, Iraq, Saudi Arabia, Venezuela, Kuwait, United Arab Emirates, Russia, etc), which produces 40% of the world’s crude oil.
As they have the power to dictate fuel supply and prices, their decision of limiting the global supply reduces supply in India, thus raising prices
The government charges about 167% tax (excise) on petrol and 129% on diesel as compared to US (20%), UK (62%), Italy and Germany (65%).
The abominable excise duty is 2/3rd of the cost, and the base price, dealer commission and freight form the rest.
Here is an approximate break-up (in Rs):
a)Base Price | 39 |
b)Freight | 0.34 |
c) Price Charged to Dealers = (a+b) | 39.34 |
d) Excise Duty | 40.17 |
e) Dealer Commission | 4.68 |
f) VAT | 25.35 |
g) Retail Selling Price | 109.54 |
Looked closely, much of the cost of petrol and diesel is due to higher tax rate by govt, specifically excise duty.
So the question is why government is not reducing the prices ?
India, being a developing country, it does require gigantic amount of funding for its infrastructure projects as well as welfare schemes.
However, we as a society is yet to be tax-compliant. Many people evade the direct tax and that’s the reason why govt’s hands are tied. Govt. needs the money to fund various programs and at the same time it is not generating enough revenue from direct taxes.
That’s the reason why, govt is bumping up its revenue through higher indirect taxes such as GST or excise duty as in the case of petrol and diesel.
Direct taxes are progressive as it taxes according to an individuals’ income however indirect tax such as excise duty or GST are regressive in the sense that the poorest of the poor and richest of the rich have to pay the same amount.
Does not matter, if you are an auto-driver or owner of a Mercedes, end of the day both pay the same price for petrol/diesel-that’s why it is regressive in nature.
But unlike direct tax where tax evasion is rampant, indirect tax can not be evaded due to their very nature and as long as huge no of Indians keep evading direct taxes, indirect tax such as excise duty will be difficult for the govt to reduce, because it may reduce the revenue and hamper may programs of the govt.