'Car to flat to fuel': CA breaks down how salaried Indians are taxed at every step

From buying a car to investing in mutual funds, salaried Indians are taxed at nearly every turn — a burden that disproportionately affects the middle and upper-middle class, argues CA Nitin Kaushik in a financial thread breaking down India’s tax structure.

In a series of posts on X, chartered accountant Nitin Kaushik (@Finance_Bareek) highlighted how India’s tax system piles income and consumption levies on salaried professionals — often without relief.

“Buying a car? Up to 50% of the price = taxes,” Kaushik posted, citing 28% GST and a cess of up to 22%, particularly on SUVs and larger sedans. For a car priced at ₹20 lakh (ex-showroom), total taxes can reach ₹9 lakh, pushing the on-road price near ₹29 lakh.

Homebuyers fare no better. For under-construction flats, GST is 5% on the base cost, with additional stamp duty and registration charges ranging from 6–7%. Clubhouse access, parking, and maintenance fees are taxed at 18%. “A ₹1 crore flat could attract lakhs more in layered taxation,” he noted.

Kaushik’s bigger point: salaried Indians earning ₹25 lakh annually (₹2.08 lakh/month) are taxed on every front — income tax, GST on goods and services, and taxes on investments like short-term capital gains, long-term capital gains, and dividends.

“India has progressive income tax, but regressive consumption tax,” Kaushik wrote. “The more you buy, the more you’re taxed — even after paying income tax.”

He argues that the current structure hits salaried earners hardest — people who don’t enjoy exemptions, under-reporting, or business deductions.

Among his proposed reforms: input tax credits on EVs and homes, GST relief on essential spending, tax rebates for consistent TDS filers, and rationalising what he calls “double taxation” on income and spending.

“This is not about tax evasion,” Kaushik wrote. “It’s about awareness and policy balance. Over-taxing salaried earners weakens both savings and consumption.”