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While the stock market was crashing
and burning, the Government rescinded
an internal note that called for a 16%
tax on water processed by branded and
unbranded water “manufacturers” as
well as municipal water supply. Faced
by increased pressure from water
bottlers, the Government withdrew the
proposal.
The Government has been waffling on
the issue of taxing water. It
introduced a tax on processed water
early last year calling it a
manufactured item only to withdraw the
tax on unbranded water in February
2005. It reintroduced the tax again in
March this year and also this new
proposal to tax all municipal water.
If implemented, the tax would affect
almost all citizens and possibly
created a political storm for the
besieged minority Government. However,
the Government is right to introduce
this tax although it is for the wrong
reason. The Government can use the
monies collected to maintain ancient
storage tanks and waterways and built
new facilities.
With over a billion people, the
country has very poor water harvesting
and management facility. Its
states are often in conflict over
river water sharing and even
districts within a state are
constantly fighting with each other
to get a fair share of water. Precious
river water is being frittered away on
the wrong crops in wrong region just
because it is profitable and water is
free. Politicians easily hand out
water sops to new areas that have no
sanction to be there in the first
place. Municipal pipes are broken and
water leaks into the ground. People
waste water because they get it free.
Tanks and waterways created thousands
of years ago and stood the test of
time are being built over by corrupt
politicians and natural flow of water
is being hindered by encroachments.
Storage tanks are not de-silted
leading to smaller storage areas and
when de-silting is allowed, the
operation is not supervised leading to
bunds being weakened and breaking when
tanks get full.
Instead of using river water for
drinking and processing waste water
for agriculture, India uses river
water for agriculture and ground water
for drinking. Such short-sighted
policies have greatly compromised
sustainable development. Ground water
tables are receding fast and the rich
use more powerful motors to extract
more water without any concern to
recharge it.
Research has shown that giving people
facilities free is not valued.
Instead, even a moderate tax on water
will bring value to it and the
population will learn to use it more
responsibly.
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