A quicksand of taxes.

The goods and services tax (GST) was introduced in 2017 to incorporate most indirect taxes in India, bring down the eventual tax paid by consumers by avoiding cascading effect, and "cast the country's tax net wider, with the value of input credits -- refunds of taxes already paid on inputs -- acting as lure for informal businesses to sign up", wrote an editorial in the Mint. Refunds were to be paid by matching invoices at different levels of transactions but the software had problems and so was given up. With no cross-matching of invoices some resorted to false claims of refunds based on fictitious invoices. "In response, the GST Council's law panel has reportedly proposed a stringent mechanism for GST registration that would double down on identity verification and other checks, with the speed of this process dependent on the 'trustworthiness' of applicants." "People have written about trust from Francis Fukuyama to contemporary writers to laboratory tests, a society does well when there is trust among one another. Then people begin to invest. There are lab tests showing the relationship between investment and trust," said Prof Kaushik Basu. The reason for more restrictive laws is that, "Despite a surge in October GST collections this year, the central government is still looking at a big shortfall in tax revenue, if the first six months of tax collections is anything to go by," wrote Dipak Mondal. The shortfall is expected to be Rs 6.2 trillion for the financial year. To compensate for high taxes on domestic products, "His (Prime Minister Narendra Modi) administration has repeatedly increased tariffs, licence requirements and other restrictions on imports," wrote Jairaj Devadiga. "For instance, the new iPhone 12 Pro is so expensive in India that it would be cheaper to fly to Dubai, buy it there, and return." Another reason for high prices in India is the price of fuel. India imported $102 billion worth of crude oil in 2019-20. The price of India's basket of crude oil has fallen substantially this year but the government has been increasing taxes relentlessly so that consumers are having to pay over Rs 81 per liter in India whereas the average price of petrol in the US on 23 November was 65 cents, or about Rs 50, per liter. "Our FDI policy woos investors in every international forum to India. Throwing bait to investors only for tax authorities to lay boobytraps and ambush them after putting their money in good faith is not just breach of trust. It scares away future investors too." wrote Capt GR Gopinath. Even though there were signs of recovery in October, as reported by Bloomberg, "If consumption weakens, inclines seen on may market offtake charts may flag off," the Mint opined. Taxes raise prices and make us poor. No consumption, no demand, no investment.