Skip to main content

Land utilisation

  LAND UTILIZATION  Land is a scarce resource, whose supply is fixed for all practical purposes. At the same time, the demand for land for various competing purposes is continuously increasing with the increase in human population and economic growth.Land use pattern at any given time is determined by several factors including size of human and livestock population, the demand pattern, the technology in use, the cultural traditions, the location and capability of land, institutional factors like ownership pattern and rights scale regulation. Major Types of Land Utilization in India : As in all other countries, land in India is put to various uses. The utilization of land depends upon physical factors like topography, soil and climate as well as upon human factors such as the density of population, duration of occupation of the area,land tenure and technical levels of the people.There are spatial and temporal difference in land utilization due to the continued interplay of phys...
Post a Comment

Value added tax (VAT)

VALUE ADDED TAX (VAT)
It is a tax on the value added to a good or service. Value added is the difference between a firm's revenue and it's payment to other firms. It is defined as the tax to be paid by all sellers of goods and services on the basis of value added by their respective firms. It is levied on the value added to the product of each stage in the chain of transaction.

Characteristics
a)It us multistage tax rather than single stage one like the retail sale tax.
b)It is levied on all stages of production and distribution.
c)It is comprehensive unlike selective excises.
d)It is collected in bits at each stage of production and distribution.
e)It is method of taxing by instalments final spending in the domestic economy.
f)It falls on each input entering into final products once and only once.

Merits
a)It avoids cost cascading effect because it ensures that an input is taxed only once.
b)It is neutral between the processes of integration of production and therefore helps the economy in adopting those forms of production which are economically more suitable.
c)It is neutral between costs because it taxes all value added. Thus,it does not hinder the adoption of advanced capital intensive technology.
d)It is neutral towards resource allocation.
e)It encouraged efficiency because a firm is not exempted from tax liability even if it incurs losses. Thus,firm will try to improve its performance and reduce production cost.
f)There us less possibilities of tax evasion as tax is divided into smaller parts.
g)It has great deal of administrative flexibility in the sense that it can be modified to suit different policy objectives.

Demerits
a)It is complicated as there is requirement of efficient government machinery to do cross checking.
b)A country should have sufficiently advanced financial and economic structure for the adoption of VAT.
c)It should have habit of keeping proper records.
d)VAT system depends lot in cooperation of tax payer . Each firm has to calculate it's tax liability and also to find out the taxes paid by earlier firm.
e) Maintenance of costly account itself become uneconomic especially for Smaller firm.
f)In India , speculative hoarding , non competitive price rise and other such practices are very common. In such a market , VAT may fail to induce efficiency among producers and sellers.

Comments

Post a Comment

Popular posts from this blog

Tokenization

Tokenization  Tokenization is the process of turning sensitive data into non-sensitive data called "tokens" that can be used in a database or internal system without bringing it into scope.  •It can be used to secure sensitive data by replacing the original data with an unrelated value of the same length and format.  •The tokens are then sent to an organization’s internal systems for use, and the original data is stored in a secure token vault. •The purpose of tokenization is to swap out sensitive data—typically payment card or bank account numbers—with a randomized number in the same format but with no intrinsic value of its own. •Tokenization is the process of removing sensitive data from your business systems by replacing it with an undecipherable token and storing the original data in a secure cloud data vault.  Token will be unique for a combination of card, token requestor (i.e. the entity which accepts request from the customer for tokenisation of a card and p...
Post a Comment
Read more

Role of capitalism

ROLE OF CAPITALISM IN DEVELOPING ECONOMY Capitalism is that part of the economics where there is no role of government agencies. The sole supe power of capitalism is in the hands of private owners. This means that if private is working on the behalf of government, instead of social welfare, their main objective is to have profits. Features Lack of intervention of government. Role of private firms. Role of price mechanisms. Advantages Encourages innovation Efficient firm incentives Consumers can choose services of their choice. Prevents government from interrupting. Creates climate of innovation and economic expansion. Helps in increasing GDP. Disadvantages Firms can gain monopoly power. Externalities damages the environment. Prone to boom and bust in the economic cycles. Inequality creates social division. Capitalist market crashes causes economic downturn , uneven business cycles. There is difficulty in mobilising unprofitable sector into profitable sectors. By taking advantage of poo...
Post a Comment
Read more

Investment Multiplier

INVESTMENT MULTIPLIER The number of times by which the increase in ∆Y exceeds the increase in investment is called as Investment Multiplier.  Investment Multiplier or output multiplier refers to the number of times by which the increase in output/income ∆Y exceeds the increase in investment ∆I. It is measures as the ratio between change in output /income and change in investment.                                      k = ∆Y / ∆I Where k is the multiplier. Relationship between Multiplier and Marginal propensity to consume (MPC) There is direct relationship between Multiplier and MPC . Higher the value of MPC ,higher the multiplier .                   K =1 / 1- MpC This is because of the given reasons : a)Additional investment means additional expenditure in the economy, additional expenditure means additional income . b) Higher the value of MPC ,...
Post a Comment
Read more