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Strategies & Market Trends : India Coffee House

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To: JPR who wrote (2671)	9/4/1998 1:10:00 PM
From: ratan lal	Read Replies (1) of 12475

JPR Re: Indexing capital gains for tax purposes India is way ahead of the rest of the world in recognising that the Rupee tomorrow 'MAY' be worth less than the Rupee today. ANd it is up to the Governmetn ot make sure that it is not worth a lot less if they want ot collect higher tax revenue Can you imagine if you bought real estate for, say, $ 1 mil today nad sold it in 10 years for $2 mil. But the cumulative inflation in the next 10 years is 100%. SO your $2 mil is actually worth only $ 1mi. ANd if you pay 20% tax on the $2 mil = $400,000 then your original $1 mil is now 1/2 of 1,600,000 or = $800,000 and you have lost $200,000. You cna also use the example of Currency conversion. Thats why the banks and international companies are getting into trouble today. Even tho they make operating income, when u consider conversion they actually lose money. Why should the Govt. give them that benefit. Why not tax them on their profits and forget the conversion Just something to think about - But INdia is definitely progressive. Of course having literlaly invented Math I would expect them to be.

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