Fact Check: The claim of taking Rs 51 as tax on earning Rs 100 is wrong, there is fraud in the calculation.

What is the claim?

Vikas Bansal has shared this video in his/her ex-post. he/she writes that the government has taken half of the public’s income as tax, yet the debt of the country is increasing. They ask where is this money going?

What’s in the video?

In the video, the woman is telling how if a person earns Rs 100, he/she has to pay only Rs 51 in tax and he/she is left with less than half the money. She says- I will tell you for Rs 100. If you have income then 30% tax means Rs 30 has gone to the government. You have Rs 70 left. Out of that 70, you have to pay 12 percent GST, depending on the goods, whatever goods you buy. This amounts to 8 rupees 40 paisa. Rs 30 gone earlier and this Rs 8.40. Total became Rs 38.40. If you buy some expensive goods then 18% tax. This is 12 rupees 60 paise. So the total tax that the government takes from your Rs 100 is Rs 51 (Rs 30+8.40+12.60). That means half of your earning goes to tax and you are left with Rs 49, which is not even half.

She further says that understand this and create awareness about it. I just told you the account of Rs 100. Meaning, the 70 rupees that are left with you out of 100 are also subject to GST at 12 and 16 percent. If you understand then tell this to everyone and spread it. Having knowledge is a very good thing. You learn about this thing.

What is the truth?

The woman makes two very false claims. One thing is that 30% tax has been added on everyone’s earnings. Whereas 30% is the highest tax slab. In the new tax slab, annual income of more than Rs 15 lakh is taxed at 30%. A large population of the country does not come in this tax slab. Then the woman makes a big mistake in her calculations. She tells that after paying tax of Rs 30 on the income of Rs 100, the remaining Rs 70 is first charged 12% GST and then 18% GST. This cannot be. Even if you buy an expensive item for Rs 70, GST at the rate of 18% will be only Rs 12.60. In this way, after adding tax and GST, Rs 30 and Rs 12.60 = Rs 42.60 and not Rs 51.

With Rs 70, you can buy either those goods which come under the purview of 12% GST or those which come under the purview of 18% GST. It is not possible that with just Rs 70 we can buy both the items worth Rs 70 each. Rs 140 will be required for this. But the woman tells that on Rs 70, first at the rate of 12% it will cost Rs 8.40 paise and again at the rate of 18% it will cost Rs 12.60. This claim is absolutely wrong.