Archive for February, 2015

Understanding the Tax System …

Posted on February 19, 2015. Filed under: American Thinkers, Business, Indian Thought, Light plus Weighty |

David R. Kamerschen, Ph.D. Professor of Economics, University of Georgia, put this together to show how our current tax system works based on each segment of our population.For those who understand, no explanation is needed! For those who do not understand, no explanation is possible!This is how it goes.

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this:

The first four men (the poorest) would pay nothing.The fifth would pay $1. The sixth would pay $3. The seventh would pay $7. The eighth would pay $12. The ninth would pay $18. The tenth man (the richest) would pay $59.

So, that’s what they decided to do. The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve, “Since you are all such good customers, I’m going to reduce the cost of your daily beer by $20. Drinks for the ten will now cost just $80”.

The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free.  But what about the other six men – the paying customers?  How could they divide the $20 windfall so that everyone would get his ‘fair share’.

They realized that $20 divided by six is $3.33. But if they subtracted that from everybody’;s share, then the fifth man and the sixth man would each end up being paid to drink his beer. So, the bar owner suggested that it would be fair to reduce each man’s bill by roughly the same amount, and he proceeded to work out the amounts each should pay.

And so: The fifth man, like the first four, now paid nothing (100% savings).

The sixth now paid $2 instead of $3 (33%savings). The seventh now pay $5 instead of $7 (28%savings).

The eighth now paid $9 instead of $12 (25%savings). The ninth now paid $14 instead of $18 (22% savings).

The tenth now paid $49 instead of $59  (16% savings).

Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare their savings.

‘I only got a dollar out of the $20,’ declared the sixth man.  He pointed to the tenth man,’but he got $10!’ ………… ‘Yeah, that’s right,’exclaimed the fifth man. ‘I only saved a dollar, too. It’;s unfair that he got ten times more than I did!’ …………….. ‘That’s true!!’ shouted the seventh man. ‘Why should he get $10 back when I got only two?  The wealthy get all the breaks!’

‘Wait a minute,’yelled the first four men in unison. ‘We didn’t get anything at all. The system exploits the poor!’ ……….

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn’t show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. They didn’t have enough money between all of them for even half of the bill!

And that, boys and girls, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction.

Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.

 P.S.  That’s how in India, business funds disappear to Swiss Banks!!! I suppose all your doubts are cleared now?

 

 

 

 

 

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History of Bombay – current Mumbai …

Posted on February 16, 2015. Filed under: Searching for Success |

By Tushar Gandhi –  Grandson of Gandhiji.

According to ancient history, a grouping of seven islands comprising Colaba, Mazagaon, Old Woman’s Island, Wadala, Mahim, Parel, and Matunga-Sion formed a part of the kingdom of Ashoka the Great of Magadh, ironically in North India. The Bhaiyas and Biharis whom the Thackerays accuse of being outsiders in Mumbai, come from the region, which was a part of Ashoka the Great’s empire.

We judge everything according to history and the history of Mumbai proves that its earliest known ownership was with a North Indian. The seven islands of Mumbai passed through many hands, the sultans of Gujarat, the Portuguese and the British. Every ruler left behind proof of residence in Mumbai.

The Mauryans left behind the Kanheri, Mahakali and the caves of Gharapuri more popularly called Elephanta. The sultans of Gujarat built the Dargahs at Mahim and Haji Ali.

The Portuguese built the two Portuguese churches, one at Prabhadevi and the other St Andrews at Bandra. They built forts at Sion, Mahim, Bandra and Bassien. The Portuguese named the group of seven Islands ‘Bom Baia’, Good Bay. The British built a city out of the group of seven islands and called her Bombay.

The original settlers of the seven islands, the Koli fishermen, worshiped Mumbaidevi, her temple still stands at Babulnath near Chowpatty. The Kolis called the island Mumbai, ‘Mumba, Mother Goddess’.

In 1662, King Charles II of England married the Portuguese Princess Catherine of Braganza, and received the seven islands of Bom Baia as part of his dowry. Six years later, the British Crown leased the seven islands to the English East India Company for a sum of 10 pounds in gold per annum. It was under the English East India Company that the future megapolis began to take shape, after the first war for independence Bombay once again became a colony of the British Empire.

History has forgotten this but the first Parsi settler came to Bombay in 1640, he was Dorabji Nanabhoy Patel. In 1689–90, a severe plague epidemic broke out in Bombay and most of the European settlers succumbed to it. The Siddi of Janjira attacked in full force. Rustomji Dorabji Patel, a trader and the son of the city’s first Parsi settler, successfully defeated the Siddi with the help of the Kolis and saved Bombay.

Gerald Aungier, Governor of Bombay built the Bombay Castle, an area that is even today referred to as Fort. He also constituted the Courts of law. He brought Gujarati traders, Parsi shipbuilders, Muslim and Hindu manufacturers from the mainland and settled them in Bombay.

It was during a period of four decades that the city of Bombay took shape. Reclamation was done to plug the breach at Worli and Mahalakshmi, Hornby Vellard was built in 1784. The Sion Causeway connecting Bombay to Salsette was built in 1803. Colaba Causeway connecting Colaba island to Bombay was built in 1838. A causeway connecting Mahim and Bandra was built in 1845.

Lady Jamsetjee Jeejeebhoy, the wife of the First Baronet Jamsetjee Jeejeebhoy donated Rs 1, 57,000 to meet construction costs of the causeway. She donated Rs. 1,00,000 at first. When the project cost escalated and money ran out half way through she donated Rs 57,000 again to ensure that the vital causeway was completed. Lady Jamsetjee stipulated that no toll would ever be charged for those using the causeway.

Today Mumbaikars have to pay Rs 75 to use the Bandra-Worli Sealink, connecting almost the same two islands. Sir J J Hospital was also built by Sir Jamsetjee Jeejeebhoy.

The shipbuilding Wadia family of Surat was brought to Bombay by the British. Jamshedji Wadia founded the Bombay Port Trust and built the Princess Dock in 1885 and the Victoria Dock and the Mereweather Dry Docks in 1891. Alexandra Dock was built in 1914.

A Gujarati civil engineer supervised the building of the Gateway of India. The Tatas made Bombay their headquarters and gave it the iconic Taj Mahal Hotel and India’s first civilian airlines, Air India. The Godrejs gave India its first vegetarian soap. Cowasji Nanabhai Daver established Bombay’s first cotton mill, ‘The Bombay Spinning Mills’ in 1854.

By 1915, there were 83 textile mills in Bombay largely owned by Indians. This brought about a financial boom in Bombay. Although the mills were owned by Gujaratis, Kutchis, Parsis and Marwaris, the workforce was migrant Mahrashtrians from rural Maharashtra.

Premchand Roychand, a prosperous Gujarati broker founded the Bombay Stock Exchange. Premchand Roychand donated Rs 2,00,000 to build the Rajabai Tower in 1878.

Muslim, Sindhi and Punjabi migrants have also contributed handsomely to Mumbai.
Mumbai is built on the blood and sweat of all Indians. That is why Bombay belongs to all Indians.Apart from its original inhabitants, the Kolis, everyone else in Mumbai, including Thackeray’s ‘Marathi Manoos’, are immigrants.

The “Mumbai for Marathi Manoos” war cry has once again been raised to shore up the sagging political fortunes of the Thackeray family. When the Shiv Sena-BJP combine came to power in 1993, under the guise of reverting to the original name they replaced Bombay with Mumbai.

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