As the FT has reported this morning:
India plans to increase spending on capital investment and large-scale social programs by 29 per cent in the next year, while imposing a one-year 10 per cent tax surcharge on the “super-rich".
So, just as the UK is about to scrap its 50p tax rate, and give away several billion in tax to the richest in this country as a result whilst cutting benefits for most in the country, India is going the other way.
I could tell you which one has got it right, but I think you already know.
Well seeing that the current top rate of income tax in India is 30% this “Super tax” will only bring the amount paid to 40% on the top slice of income….
And that is 5% less than the wealthy will pay from April in the UK so who exactly is punishing the rich?
Also India is cutting its deficit next year from the extra money, not increasing it as a stimulus. The fact that they have had lower taxes for years gives them the room to do this, something to be learned there perhaps?