Open Letter to Finance Minister of India
Open Letter to Finance
Minister of India Shri Arun Jaitley Ji
Respected Sir,
As I can visualize, in all
likelihood Providence has chosen you to be an Immortal Finance Minister as you
have the unique opportunity to make India and following it whole world, a TAX
FREE country – No Direct Tax, No Indirect Tax, totally a Tax- less society.
A
few days ago I was conversing with my Doctor and the pain I found in her
reflects the pain of every being – rich and poor, owner or an employee, even a
Govt officer, all alike. Her agony was that after putting in hard labor day to
night she gets some meager amount as performance incentive but GST is deducted
from that amount too and that is in addition to Income tax she pays and tax on
everything that she buys. You and I too are paying all kinds of taxes but being
accustomed of it and accepting it as a part of life we do not feel the pain.
But believe me as a human being even the richest person feels the pain when he
has to part with his hard earned money, and a substantial amount at that, by
way of various kinds of taxes.
I
have been working on this concept for last several years (in fact from UPA2
days when huge scams were coming out every other day) and now I am convinced I
have a solution to it. My research says that our country owns numerous kinds of
Natural Resources and Concrete and Financial Assets built since the start of
civilization and being built every day. The cumulative value of these assets
and resources is humongous but it remains unknown.
Central and State
Governments share among themselves various kinds of these Natural Resources and
Concrete and Financial assets BUT THE
GOVERNMENT DOES NOT KNOW THE IMMENSE VALUE OF THESE ASSETS WHICH IS IN
TRILLIONS OF DOLLARS. (Imagine the value of 32.86 lakh sq km of land, or 7 lakh
sq km forests, a renewable asset, or the largest network of railways, or the
largest network of highways, the PSUs the PSBs, RBI and so on).
My conviction is that -
1.
The
Governments should have been earning revenue by producing Goods and Services
from these Resources and Assets for welfare of their people directly or by
leasing them to private sector. But Governments have taken the easy course of
extracting Taxes from their hapless subjects as per the practice from
ages. Government is earning a miniscule
(10%) income from the humongous amount of Assets and Resources at its disposal,
– Rs. 272647 crores in 2019-20 as per budget estimate, rest comes from various
kind of taxes and borrowing.
2. I
have found a Methodology to evaluate all natural resources and concrete and
financial assets. This methodology shall
facilitate evaluation of all assets and resources of each and every village,
town, city and metro of the country (6.58 lakh Geographical Entities as per
2011 census), both in public and private domain. By consolidating value of these Entities we
can compute value of assets that every Ministry owns and controls. It shall
facilitate knowing Net Worth of the Nation by enlisting all Assets and
Liabilities of the nation in the form of a Balance Sheet. Balance Sheet is the basic guide for every
commercial enterprise but Governments do not make it or have not been able to
make it though several attempts have been made by many countries in the past.
3. Once
value of resources at the disposal of Ministries is known then the second
logical step would be to ask the Ministers and learned bureaucrats of each
Ministry and State to Redesign their Work plan in a manner that
they start generating commensurate revenue from the resources at their disposal
just as in private sector. In case of need of new ideas, CEOs from private
sector can be appointed through competition between various aspirants and
appointing the ones who give most practical and most paying earning plan.
Fundamental difference between a CEO and a Government Minister is that while
the former is an EARNER the later is a SPENDER. The CEO is obliged to give
commensurate return to his employer from the resources provided to him. The
Minister has no obligation to earn; he simply gets money from budget to spend.
4. Once
the Ministries start earning from resources at their disposal pressure on
budget shall start reducing and a day shall come when their earnings shall be
optimized and they shall start contributing to the exchequer instead of living
on it.
5. I
have started writing Open letters to our Ministers and putting them on my blogs
for public participation. I am pointing out to the Ministers the huge stock of
assets they possess and exhorting them to earn revenue from these assets to
meet their revenue expenses in the first instance - A transformation
from SPENDERS to EARNERS.
6. With
the increase in revenue from assets pressure on taxes and borrowing shall start
reducing. And a day shall come when there shall be no need of tax revenue and
borrowing. In fact country shall transform in to a Lender from being a
Borrower.
7. Result
a Tax free society – biggest gift to humanity.
Sir,
I want to send you my Research Paper that explains how assets of all villages,
towns, cities, metros can be evaluated. It is a 650 pages document but I can
explain the theory within a few hours personally. New personnel required to be
appointed are Chartered Accountants, one per Ministry and constitution of a Pricing
Committee. Once the process is started
you can have 1st valuation report of nation’s natural
resources and concrete and financial assets and liabilities within 12 months.
Simultaneously a software program shall be developed that shall generate
various kinds of reports from this data base e.g.
i)
Financial profile of each of 6.58
lakh Geographical Entities
ii)
Financial Profile of every
District
iii)
Financial profile of every
Ministry of State and Center
iv)
Balance Sheet of every State of
India and
v)
Consolidated Balance Sheet of the
Nation.
Being
the Finance Minister and a student of Chartered Accountancy, Sir, you can well
appreciate the immense value of these financial reports.
Now
coming to redesigning of work plans of our Ministries I give you example of
Ministry of Railways that I have analyzed. Its budget for 2019-20 is –
|
|
|||||||||||||||||||||||||||||
If
I have interpreted correctly the Ministry needs Rs. 2181.67 crores for meeting
shortfall in Revenue expenses and 64,587 crores for new capital expenditure.
These expenses can be perhaps met otherwise instead of being a burden on
budget.
As
for shortfall in Revenue expenses, as per press reports Railways carry some 2
crore passengers every day or 730 crore per annum. This shortfall can be met in
two ways – either by saving in cost or if saving is not possible then raising
only Rs 3/- (Three rupees) per passenger or mix of both. If Rs 5/- per
passenger can be saved/earned then Railways can contribute something to the
budget instead of drawing from it.
The
capital cost can be met by raising Equity. Equity brings dividend when the
project starts earning revenue and appreciation in share value.
Similarly,
the budget of Roads & Highways needs –
Actual 2017-2018
|
Revised 2018-2019
|
Budget 2019-2020
|
|||||||
Revenue
|
Capital
|
Total
|
Revenue
|
Capital
|
Total
|
Revenue
|
Capital
|
Total
|
|
Gross
|
18099.15
|
99053.68
|
117152.83
|
19866.34
|
136126.38
|
155992.72
|
21686.98
|
142762
|
164448.98
|
Recoveries
|
-7836.79
|
-48301.28
|
-56138.07
|
-9804.53
|
-67560.69
|
-77365.22
|
-10696.01
|
-70737
|
-81433.01
|
Receipts
|
...
|
...
|
...
|
...
|
-2
|
-2
|
...
|
...
|
...
|
Net
|
10262.36
|
50752.4
|
61014.76
|
10061.81
|
68563.69
|
78625.5
|
10990.97
|
72025
|
83015.97
|
Here
again main expenditure is capital expenditure of 72025 crores. It can again be
provided as Equity that shall become an earning asset on completion of project.
Shortfall in Revenue can also be met by raising money from goods and services
being provided by the Ministry.
Sir,
what I have suggested is a Stupid proposal as I do not know the facts but the
point I want to highlight is that experts can redesign our expenditure plans
reducing burden from budget to the extent possible and generating revenue from
assets of the Ministries.
Sir,
at the first reading it may appear to be a cock and bull story but the way I
have been working on it for years I am fully convinced an implementable plan
can be engineered by financial wizards. Imagine if with positive attitude and
right efforts it is made a success what name and fame it shall bring to you, our
legendary PM Shri Modiji, BJP and our country India for all times. I am tempted to enclose a PPT which may not
be properly drafted but shall give some idea of the methodology and theory
behind it.
Sir,
I have already written open letters to our legendary Prime Minister Sir, Shri
Piyush Goyal Ji, Shri Nitin Gadkari ji, the Chief Economic Advisor and shall
continue writing letters to all Ministers and Chief Ministers explaining my
concept. These can be seen at my Blog
I against request you to kindly permit me to
send you my Research Paper for study by your Department.
With
respectful regards,
M.K. Agarwal
Mumbai
Twitter handle: @Ramsewak
Comments
Post a Comment