Editorial 1 : Before the Landslide
Introduction
Wayanad, an idyllic hill station in the lush Western Ghats, known for its vast tea plantations. The district has dense forest cover and is the origin point of rivers like the Kabini and Chaliyar. It is also home to various biological reserves, wildlife sanctuaries and national parks.
Disaster 2024
- Wayanad was stuck by a devastating landslide that claimed hundreds of lives. The landslide, triggered by a cloudburst, resulted in the destruction of homes, with several people trapped under debris.
- The disaster has left more than 300 people dead and over 300 are missing.
Cause of Landslide
- While heavy rains caused the landslide, the unchecked development driven by tourism and quarrying has significantly disturbed Wayanad’s fragile topology.
- The landslide was triggered by extremely heavy rainfall caused by the warming of the Arabian Sea.
- The southeast Arabian Sea is becoming warmer, leading to atmospheric instability over large parts of the Western Ghat, including Kerala. Rain-laden areas with deep clouds are moving southward, resulting in excessive rain.
Beyond the immediate causes
- Nearly half of Kerala comprises hills and mountainous regions with slopes exceeding 20 degrees, making these areas particularly prone to landslides during heavy rains.
- Landslides and flash floods often occur in regions where the impacts of both climate change and human intervention in land use are evident.
- Change in land use: Decreasing Forest area and increasing rubber plantations. 62% of the district’s green cover disappeared between 1950 and 2018, while plantation cover rose by around 1,800%.
- The intensity of the landslide increased because of the rubber trees, which are less effective in holding soil compared to the dense forest cover of pre-plantation times.
- Mindless and unscientific construction practices are a major cause of the current devastation.
Gadgil Committee (2011) Recommendation
- The Gadgil Committee recommended the banning of construction, mining, and quarrying activities in large parts of the Western Ghats, one of the world’s eight hottest biodiversity hotspots.
No Lesson Learnt from Past
- A similar tragedy struck Kerala’s hilly regions in 2019. Despite clear warnings from experts, unchecked construction and tourism-related activities have continued unabated.
- Wayanad has become an eco-tourism hotspot, leading to rampant construction activities. Resorts have mushroomed, roads have been constructed, tunnels have been dug and quarrying activities have been undertaken without proper assessment of Wayanad’s carrying capacity.
What needs to be done
- Construction of roads and other infrastructure in such regions should be undertaken with scientific precision, keeping in mind the environmental impact.
- Considering new risk factors in construction to prevent flash floods by taking river flow into account.
- Promoting sustainable land-management practices such as reforestation, controlled deforestation, and sustainable agriculture is crucial to maintaining hillside stability and reducing soil erosion, thereby mitigating the effects of heavy rains.
Way Forward and Conclusion
- Over the past decade, Kerala has witnessed numerous climate-induced disasters, underscoring the urgent need for climate-resilient infrastructure.
- The Wayanad tragedy is a stark reminder of the delicate balance between nature and human activity. It highlights the dire consequences of neglecting ecological warnings and the pressing need to adopt sustainable development practices to safeguard the environment and the lives that depend on it.
Editorial 2: Easing the Burden
Introduction
Law Commission in 1958 set out to logically arrange the Income Tax Act 1922 in order to simplify it. The experts admitted that there cannot be any real simplification of the Act without the simplification of the tax structure.
Decades later, the goals for income-tax reform remain centred around simplicity and stability.
Recent Reforms in Tax Structure
- The corporate tax-rates are reduced and incentives are being phased out under the new tax regime.
- Around 58% of corporate taxpayers have opted for the new tax regime, lowering the effective tax rate to 23.26% in 2021-22 as compared to 29.49% in 2017-18.
- To further streamline the system and attract foreign investment, the corporate tax-rate on foreign companies has now been reduced to 35% and the angel tax has been abolished.
- Personal income-tax slabs are now fewer and simplification of compliance has brought on board more taxpayers.
- The current Budget has further reduced the tax rate for incomes below Rs 12 lakh, which will impact more than 80% of individual returns and 51% of the gross income filed in returns.
An Eye on the Future
- Despite the reductions in tax rates, the direct tax to GDP ratio has increased. Yet, many believe that India has yet to achieve its tax potential.
- As the country sets its sights on achieving developed country status by 2047, the question is what tax policy can do next to ensure a balance between growth and equality.
Taxing the Capital Gains
- The reform of the capital gains regime is on government’s agenda. It is in line with global thinking as many countries have attempted to reform the taxation of passive incomes after Covid-19.
- The Budget proposed an increase in the capital gains tax on equity as well as a higher securities transactions tax on futures and options.
- The rationalisation of the rates across asset classes and the removal of indexation benefits suggest that the government no longer seeks to prioritise investments.
Resolving Disputes
- An important aspect of certainty in the application of the Income Tax Act is the prevention and resolution of disputes.
- Vivad Se Vishwas scheme offers a way to settle long-standing disputes.
- Shortening the period of reassessment and putting in place higher monetary thresholds for disputes are ways to reduce the confrontations between taxpayers and the income tax department.
Conclusion
The government has announced its intent to review the IT Act. It is important to carefully redraft the contentious sections of the act in order to fundamentally resolve the source of the disputes.