A green wealth tax in Budget 2024
- July 24, 2024
- Posted by: OptimizeIAS Team
- Category: DPN Topics
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A green wealth tax in Budget 2024
Sub: Env
Sec: Climate change
Indian Green Deal (IGD) | |
About | Proposed development model focusing on just, inclusive, and sustainable growth. |
IComponents | Green energy, infrastructure, and care economy (health and education). |
Spending Allocation | 5% on infrastructure, 3% on care economy, and 2% on green energy. |
Funding IGD | The wealth tax rate of 1.7% initially, declining to 1.3% by 2032 due to the projected rise in the wealth of the Indian elite. |
Employment Generation | IGD could generate 38.7 million jobs, equivalent to 8.2% of the Indian labour force. |
What is Wealth Tax?
- Wealth tax is categorised as a direct tax, targeting individual assets like cash, shares, and property.
- India’s Wealth Tax Act, established in 1957, imposed a 1% tax on earnings exceeding Rs 30 lakh per year. However, due to ineffective implementation, the Act was repealed in 2015.
- India has seen a rise in billionaires, with 94 new additions, reaching a total of 271. A study by Thomas Piketty highlights extreme wealth disparity in India, indicating the richest 1% hold a disproportionately large share of wealth.
- The EU Tax Observatory, a European tax think tank, has proposed a global minimum tax of 2% on billionaires’ wealth, potentially generating approximately $250 billion annually.
Carbon footprint:
- The World Health Organization (WHO) defines a carbon footprint as a measure of the impact of human activities on the production of carbon dioxide (CO2) resulting from the combustion of fossil fuels. It is quantified in terms of the weight of CO2 emissions produced, measured in tonnes.
- This metric is applicable to individuals, organizations, products, events, and other entities.
- The rising emissions by the Indian elite have been led by their conspicuous consumption of carbon-intensive commodities such as housing, industrial goods, transport and clothing.
- The per capita carbon footprint of the top 10% of the Indian population is almost equal to that of a first world citizen.
Source: TH