THE ARTHA SHASTRA
|Chanakya (371 - 283 BC)|
Artha Shastra suggests a tax of 4% on agricultural produce worth and 6% on equivalent business income. These work out to be below the existing tax rates. Artha Shastra strongly disapproves government’s excessive concentration on the cities and possible neglect of rural areas. Government must never spend all the money it collects by way of taxes. Kautilya maintained that some part of the income should be saved to provide for exigencies. He was not in favour of the practice of debt financing. Similarly, householders must not spend in excess of their incomes. The golden formula is 25% of income to be spent on personal needs, 25% given away in charity, 25% for public and social causes and 25% to be saved for future needs and exigencies (natural calamities, disasters, etc.), old age etc. The endeavour should be towards self-sufficiency. Businesspersons must be devoted to their business even though profits are low. These days, people buy and sell shares to make personal gains which works against the interests of companies and the nation. Government must maintain a buffer stock of food grains, which would be useful during downturn times. Value of human beings is superior to any amount of wealth.
|Division of Wealth as recommended by Chanakya|
Source: Art and Science of Management in Ancient India, Chapter 4, Man Management: A Values-Based Perspective