India should let tele migration bloom before worrying about how to tax writers, creators and consultants, says India’s Chief Economic Advisor K V Subramanian

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India should let tele migration bloom before worrying about how to tax writers, creators and consultants, says India’s Chief Economic Advisor K V Subramanian
Telemigration, also known as work from home, has become an essential part of out post-Covid lives.Unsplash
  • Telemigration has become mainstream over the last one year or so, allowing people to work from the comfort of their homes.
  • This has been enabled in large part due to the wider availability of 4G and optical fibre broadband.
  • India’s chief economic advisor, KV Subramanian, said that the WFH culture needs to bloom first before the government worries about taxing these workers.
Telemigration, also known as Work from Home (WFH), is not new. It has caught the fancy of millions of people and organisations around the world only after the COVID-19 pandemic struck in 2020. As far as the mainstream goes, tele migration has been in the public discourse for just over a year now.

In a conversation with Business Insider during the Future of Work 2021 event, India's chief economic advisor, K V Subramanian underlined that telemigration pre-pandemic would have been unimaginable. However, things have changed drastically since then.

And there’s a good reason behind this. With adequate internet connectivity, millions of employees and organisations have realised that it’s not necessary to have people in offices all year round.

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While some workplaces require their employees to come into offices due to the nature of work, others like startups have embraced the WFH culture, helping them trim down the costs associated with offices.

With that said, telemigration comes with its own challenges, with the most important one being how do you decide where you have earned your income from. From a taxation point of view, determining the place of business is important to understand the tax jurisdiction.

But before being overly enthusiastic about promoting tele migration with tax-friendly policies, or being too aggressive about taxing these workers, Subramanian said telemigration needs to bloom properly and become capable of standing on its feet.

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To explain this, he gave the analogy of how bees pollinate flowers by sucking a small amount of nectar, leaving the rest for the flower to bloom. The bees are analogous to the government, in this instance.

Taxation must be thought of in a symbiotic way, instead of being over-enthusiastic at this point of time.

K V Subramanian

Subramanian also explained that telemigration has benefits for workers, too.

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Thanks to the wider availability of optical fibre broadband, workers do not have to relocate for employment and can work from the comfort of their homes.

He also added that often, those who work from home are often more committed because they don’t have to become migrant workers.

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