Wealth tax is a tax which is based on the market value of owned assets. It is paid by almost 2.5 percent of the population of our country. It is a tax which is imposed on person’s net worth. It is also known as 'Capital tax'.
It is a very familiar fact that the whole world is suffering with a pandemic ' COVID-19'. Taking into account the protection of citizens different countries have announced a lockdown. As a result the economy is getting down day by day. The treatment is going on. For treatment proper ventilators , medicines etc are required. For it economy must be strong which is not at the time of need. So, a policy is imposed where the 1 percent richest will be imposed 2 percent of wealth tax. The tax will be imposed on 953 richest families of the nation so that the government could get about 1 percent of GDP which is the highest package.
It is proposed that the 1 percent richest will have to pay the tax. It is also found that this policy is a ' Covid bond' policy. It has lots of merits. It is equitableness, reasonably unstressed tax-targeting and a relatively non- inflationary mechanism for financial debt.
It is also announced that top 1 percent wealth group will have to pay 1 percent marginal tax. A total of 67.5 percent in GDP. The 0.1 percent will have to pay a total of 30 percent of GDP. Such a tax would levy 1.05 percent of EU GDP per year.
A survey was done and it was found that the distribution of assets was not proper in our country. The survey of 2012-13 displayed the inequality in the distribution of assets. It happened due to the under – reporting of the wealth by the wealthy and as well as the failure in surveys done.
A flat tax of 4 percent is imposed upon the wealthy families of the Rich List. It has a threshold of about Rs.1,000 Crores. The financial package announced by the government to combat epidemic is less than 1 percent of GDP and this outlay is padded up with various schemes such as PM Kisan and Mahatma Gandhi National Rural Employment Guarantee. In the past seven years the list of Hurun Rich List has grown up to 953. India still lags behind two countries in the terms of dollar billionaire. We have limited options such as the abolition of wealth tax, reduction in the corporate tax and a one day deduction of the mandatory salary from the satff of AIIMS and donating it into the PM- CARES FUND.