here's one way of ending corruption!

i was introduced to anil bokil in an article written by sandesh kirkire (ceo of kotak mutual fund) called 'abolish all taxes and kick out corruption'. this was a revolutionary idea proposed by anil bokil and i was intrigued enough to get more details from his website - http://www.indiathesuperpower.net/

some of the startling facts mentioned in sandesh's article include :
- the fact that less than 3% of india's population pay taxes.
- the fact that mumbai's population is 1.2 crore but has only 17000 taxpayers with income above Rs.10 lakhs.

in this context the article mentions the proposal suggested by anil bokil which seems deceptively simple and is definitely 'out of the box'. what it does achieve is getting you to think and wonder if there is a catch in it somewhere.

the key highlights of the proposal are :
- abolish all taxes in the country except import and customs duties.
- remove all currency notes above Rs.50 denomination from the system by asking all holders of this currency to deposit it in the bank.
- make it mandatory for all transactions above Rs.2000 to be done through the banking channel, i.e. through cheques, or credit/debit cards.
- introduce a flat transaction tax of, say, 2% on every transaction in the banking system in the recipient's hand.
- such tax amounts recovered to be transferred daily to the central government, state government, municipalities in a pre-determined proportion at a fee.
- cash transactions of a lower value not to attract any transaction tax.

some of the implications of this proposal are :
- reduction in actual tax paid by tax-payers; but increased tax collection by the government
- tremendous pressure on the parallel economy which thrives on the large denomination currency notes (ever wondered why you do not see the Rs.1000 denomination notes?)
- huge growth of the banking industry - higher deposits; rise in banking transactions; easier accessibility to funds for lower credit borrowers; cheaper sources of finance for the rural economy.
- fall in inflation since taxes/duties make up a huge component of prices of all goods/services
- resultant growth in demand for manufacturing sector
- complete removal of the entire bureaucracy managing the tax processes; also huge savings of time spent on tax management by corporates and tax payers

though this proposal sounds fantastic there are many questions and issues it raises :
- the parallel economy would move onto other foreign currencies like dollars
- the banking system would need to be geared to handle this enhanced role; it would also need to be able to reach out to a much wider audience than it does today
- even though funds would be available at lower rates it would not necessarily translate into credit for the farmers and lower credit rating borrowers; such segments which today depend on the cash economy would be starved of any funding
- the huge inflows of liquidity into the system (especially in the beginning when cash is converted into bank deposits) would put upward pressure on inflation
- government spending would still not necessarily become more accountable or efficient
- and most importantly - 'where is the political will to carry through such a revolution in the country'?

but what you cannot deny is the simplicity of the idea, and the fantastic scope of the vision behind this proposal.

i believe that with this proposal mr. anil bokil has at least suggested some solutions and has made me sit up and think. and that, in my eyes, is far better than my just griping about the problem of corruption!

do you have any similar, 'out of the box' solution to this problem?

how corrupt is the mumbaikar?

for those of us who live in india, especially in cities like mumbai, corruption is something that we see all around us. in fact it is almost a way of life; the fuel which seems to keep the city going. it is so strongly established and deeply ingrained in the psyche of the common mumbaikar that you wonder if most things would ever function without this all-pervading corruption! :-)

not for one moment am i claiming that everybody is corrupt and that there are no individuals untouched and untarnished by this scourge. but such individuals are more the exception than the rule!

and i have noticed that corruption is the greatest equaliser in our city where everybody from all strata of society have to make their offerings to this modern-day demon with an ever-increasing appetite.

and the corruption juggernaut is so amazingly well-organised and functions like a smooth well-oiled machine. i can not think of any walk of life which is not touched by the long arm of corruption (it most definitely reaches far beyond the 'long arm of the law'!)

let me list some of the places which seem to be so completely sold out to corrupt practices that it seems to have become the norm.

1. rto - have any of you readers ever managed to get your driving license or got a duplicate copy of your rc book in the recent past by going through the regular channel? i think the regular channels have long been sealed with over-grown weeds and thick cobwebs!
but mind you, you could never approach the rto officials directly and attempt to bribe them! that would be unpardonable and you could serve time because of attempts to bribe a government official.
there is a network of 'rto agents' who will get you a driving license or any similar such document for a fee, part of which feeds the entire rto bureaucracy in a very well-organised manner, with the money (rumored to be running into crores) reaching up into all the levels within the rto, all the way to the top. (i honestly don't know where the top is!). and for a fee you could get a driving license even if you didn't know your left from your right! i mean, what does that have to do with getting a license?

2. stamp duty/ deed registry office - this is another place where you could end up running in circles for days without getting anywhere close to registering your document/agreement if you want to buy or sell any real-estate! all the real-estate deals that i have come across, have had to use the 'services' of the friendly neighbourhood 'agent' who manages to move through the registration office as if he is the lord and master of that place! but you must give credit where it is due! they manage to get your registration process completed in the shortest possible time. and i am told that the amount of money the officials here make if far more than they could hope to make in the rto office. here too the money apparently moves all the way to the 'top'!

3. but the award for the most corrupt set of people i have ever come across goes to the customs department! i am told that many of the officers have to pay a hefty amount of money as bribe to get posted into this lucrative department. for the official it is now a matter of recovering his 'investment' and making a neat margin without over-exerting himself in the process!
i had to pay a princely sum of 1000 rupees for bringing in 'commercial' quantities (as defined by the customs officer) of some shawls which a friend had sent with me to be donated as gifts to some senior citizens! but he didn't want to dirty his hands and got a constable on duty to do the disagreeable job on his behalf. the constable told me that he would get a 10% cut and the rest of the money is shared by the officers all the way to the 'top'! he also confided that the daily earnings of the officers ran into tens of thousands of rupees!

4. the saddest form of corruption i have witnessed is the 'hafta' or weekly bribe paid by the street vendors in mumbai to representatives of various agencies including the municipality, the local police, the local don, etc. the vendor has to pay his share of hafta whether his business has done well that day or not. and in spite of paying this 'protection money' they are not assured of any protection when there is a drive by the local municipal ward to clean up the footpaths of the vendor menace. the truth is that these drives are just subtle reminders from the officers at the 'top' to keep coughing up the 'protection money'! the only protection this bribe provides to the hapless vendor is from the people who collect the money!

so whats the point i am trying to make here? that we must fight against corruption? that we must learn to accept it as a necessary evil which oils the wheels of bureaucracy?

i think corruption in society is a reflection of our own greed and selfishness! i think corruption will thrive and will always be present as long as we continue to opt for the easier way in life!

i think corruption in some way is also an unconscious, social mechanism of rationalising the disparities that exist. for example, the government would like to offer free or subsidised services to society. but corruption ensures that the beneficiaries have to finally end up, directly or indirectly, paying more realistic prices for the services they use. (most often they end up not receiving the services at all!)

no that doesn't justify corruption. i think there's definitely some lesson in here about proper governance, but i can't see it! can you?