Political economist and author Gautam Sen has said the idea to impose a wealth tax in India will lead to the country's super rich, the Ambanis and the Adanis, moving their bases out to countries like Dubai to avoid paying tax.
IMAGE: Prime Minister Narendra Modi during the interaction with business leaders Reliance Industries chairman Mukesh Ambani, Tata Group patriarch Ratan Tata, Chairman of the Mahindra Group Anand Mahindra, Adani Group chairman Gautam Adani in New Delhi. Photograph: ANI Photo
He further explained that the wealthiest individuals in India, such as Ambani, Adani, and Tata, would likely emigrate to tax havens resulting in a substantial loss of wealth for India.
Sen who retired from the London School of Economics and was formerly a member of the Indo-UK Roundtable and Senior Consultant at UNDP, offered his insights on the proposal of implementing an inheritance tax in India, drawing comparisons with the United States and discussing its potential impacts on the Indian economy and security.
"The very rich, that is the Ambanis, the Adanis, the Mahindras, the Tatas, and I presume not more than 500 or less of the very rich, the billionaire class, they will emigrate from India to Dubai. Most Indian millionaires who have been leaving the country have gone to Dubai, 70 per cent in fact, because Dubai has no income tax. And they will re-register their businesses in UAE, which means India will only be able to collect corporate taxes from them because their business will remain in India," Sen said.
"So there will be a huge loss of wealth to India. Now, if you think about other countries, Sweden used to have a very significant inheritance tax. And Sweden is one of the highest tax countries in the world in history. But you know, Sweden removed the inheritance tax because many of the rich were fleeing. For example, the owner of IKEA had migrated out of Sweden," he said.
"And what they found after removing inheritance tax, that a lot of the wealth came back, economic growth improved, and tax collecting also improved. So with that extra taxes, they could redistribute to the less well-off in Sweden. So, in fact, not having inheritance tax or wealth tax was beneficial to the ordinary Sweden. Now, in India, if you inflict this amount of chaos, you must bear in mind you can't do it to agricultural land", the economist added.
https://www.rediff.com/news/report/...if-india-imposes-inheritance-tax/20240508.htm
IMAGE: Prime Minister Narendra Modi during the interaction with business leaders Reliance Industries chairman Mukesh Ambani, Tata Group patriarch Ratan Tata, Chairman of the Mahindra Group Anand Mahindra, Adani Group chairman Gautam Adani in New Delhi. Photograph: ANI Photo
He further explained that the wealthiest individuals in India, such as Ambani, Adani, and Tata, would likely emigrate to tax havens resulting in a substantial loss of wealth for India.
Sen who retired from the London School of Economics and was formerly a member of the Indo-UK Roundtable and Senior Consultant at UNDP, offered his insights on the proposal of implementing an inheritance tax in India, drawing comparisons with the United States and discussing its potential impacts on the Indian economy and security.
"The very rich, that is the Ambanis, the Adanis, the Mahindras, the Tatas, and I presume not more than 500 or less of the very rich, the billionaire class, they will emigrate from India to Dubai. Most Indian millionaires who have been leaving the country have gone to Dubai, 70 per cent in fact, because Dubai has no income tax. And they will re-register their businesses in UAE, which means India will only be able to collect corporate taxes from them because their business will remain in India," Sen said.
"So there will be a huge loss of wealth to India. Now, if you think about other countries, Sweden used to have a very significant inheritance tax. And Sweden is one of the highest tax countries in the world in history. But you know, Sweden removed the inheritance tax because many of the rich were fleeing. For example, the owner of IKEA had migrated out of Sweden," he said.
"And what they found after removing inheritance tax, that a lot of the wealth came back, economic growth improved, and tax collecting also improved. So with that extra taxes, they could redistribute to the less well-off in Sweden. So, in fact, not having inheritance tax or wealth tax was beneficial to the ordinary Sweden. Now, in India, if you inflict this amount of chaos, you must bear in mind you can't do it to agricultural land", the economist added.
https://www.rediff.com/news/report/...if-india-imposes-inheritance-tax/20240508.htm
