The Real Black Hole. Review on Best Time to File Tax Returns

In one of his reviews, Madlaya described the Bombay local train system as a Black Hole. Since I have managed to come alive from all my commuting in these dreadful vehicles, I would refrain from calling it a “Black Hole”, a term which I think better applies to our financial structure of our Union Government, commonly understood through the document released every year on February the 28th, called the Union Budget, for which I used to contribute in the form of taxes. I say – used to – for I used to contribute in the past, proudly so, until I realized what a sucker I was.

My advice on the subject matter of the review will be a simple “DON’T”. Don’t file your tax returns, unless you don’t mind being a sucker for a system where every single paisa of your hard-earned money disappears in a black hole, never to be accounted for.

A scrutiny of the union budget, that is - how the rupee comes and goes reveals some shocking facts, that often get buried in the financial jargon(deficit financing, budgetary deficit and other such BS) used by the Economists. The Economists belong to a peculiar tribe, which is completely lacking in a trait called common sense, which even a commoner like a housewife displays in abundance. A simple display of common sense is that you spend what you earn. It is through this simple maxim that millions of ordinary people prepare their house budgets, except for the idiots called Economists, who believe that one should spend first then find the revenue and if the revenue required to cover the expenses can’t be made available through normal methods, then borrow the shortfall at a heavy rate interest. Common sense suggests, that one would fall in a debt trap that would ruin us financially, leaving us bankrupt. And we have fallen in debt trap and will be ruined financially eventually(which will be good in the long run), but since our economists don’t believe in it, we don’t bother about it. And you shouldn’t bother about it, if you are not contributing to the insanity by paying taxes, but if you are a honest tax-paying citizen then read the following:

At least fifty percent of the annual budgetary revenue that comes into the exchequer through taxes on income, sales, excise, customs etc, goes into paying Interest on various kinds of loans – both internal and external. Now why does the government borrow money?  - in order,  to meet the shortfall between receipts and payments. And from where does it borrow?  - External agencies like World Bank, by borrowing from RBI and from securities like PPF, Post office deposits, Reserve funds of UTI, LIC and other such institutions. From where does an International lender agency like World Bank gets the money to lend to hundreds of countries, considering that no country actually deposits any money with the WB. The answer is that it doesn’t have any money to lend, it simply makes a book entry that credits the account of GOI, while debiting its account, in the same manner ordinary banks do. Ordinary Banks don’t actually have the money they lend, they use depositor’s money to do so, which means that if the depositor’s were to withdraw their money from their banks at a same time, the banks would crash and become bankrupt. Now this system has its uses, but why should a sovereign nation that has a power to print its own money, need to borrow money from an external bank and worse, pay INTEREST on it? The government similarly borrows money from RBI, (which also simply prints the money required rather than generate it) and pays interest on it. The only real money that the government borrows is the one that is available through PPF, LIC, PO and other institutions. But whatever the source of the borrowings, the shocking fact is that a major part of our taxes, go into paying interest to WB, RBI and such for lending non-existent money, and into paying for the interest and dividend receipts of PPF or PO account holders.

A simple question  –  Why does the government borrow money, instead of simply printing it? The Economists would say – to check the flow of money. Printing of blank paper would create excess supply, leading to inflation. But when you borrow non-existent money from World Bank or RBI, you are still bringing in excess flow of money. The reason, inflation doesn’t occur, is because the government has to repay the money back to the lending agencies. Thus the inflow is checked by corresponding outflow. Now a simple solution would be to borrow all the money from the RBI interest-free or to stop borrowing at all. This would mean no Interest payments to be made, which now form the bulk of budgetary payments every year. But what the government has done instead, on the advice of the Oxford-educated Economists, is to go on borrowing every year. As a result interest payments every year touch 1, 00, 000 Crores. This is day-light robbery of public funds.

The other big black hole is the Ministry of Defense. Over 75, 000 crores of tax receipts disappear every year to feed this White Elephant, a bulk of which go in buying costly arms(even coffins for our dead soldiers) from European and American companies. Most of the weaponry purchased is bought at inflationary prices to cover for the cost of middlemen, politicians, defense ministry officials, generals etc. What’s the grand purpose behind it? To save a piece of land from falling into the hands of our neighbor, a piece of land, beautiful no doubt, which we cannot even visit due to the atmosphere of fear, nor on which we can buy any property. Wouldn’t it make better sense to allow Kashmiris their independence, on the condition of a pact that would allow Indians to move and trade freely without requiring a passport, as it is in the case with Nepal. But our Government  instead chooses to blow thousands of crores of tax-payers money to maintain our “sovereignty” which anyway is being eroded, every time we march to the tune of WTO, IMF, the US government etc.

Where does the rest of tax-receipts go?  For maintaining, law & order through agencies like police? Try ringing your local police station at mid-night to complain about loud-speakers!  For maintaining the judicial system? everyone knows our judiciary(like all judicial systems all over the world) is a joke. The money spent on education is a pathetic 3% of the GDP and even the education system is useful only for creating mind-controlled robotic clerks for the corporates. Whatever little was spent on poverty alleviation schemes for the poor in the form of subsidies, is being cut-back on the behalf of IMF whose sole purpose is to bring economic ruin and misery to the population of third world countries. Our Governments wants to give away all the assets valuing lacs of ccrores to the private corporations at throwaway prices. Does anyone notice that no one is demanding that the disinvestment of public sector units be made through  equity issues, so that the vast majority of the middle-class and lower middle class, could benefit from it. Our “honest” disinvestment minister Mr.Shourie proudly accepts the “Best Businessman of the Year” award. It is not a co-incidence that he once worked for the World Bank. We foolishly applaud him for his “honesty” and “integrity” in doing his job sincerely, not realizing that he is only following the agenda that his former masters have brain-washed him into doing so.

CONTINUED IN THE COMMENTS SECTION.