There is moss in them thar hills

India recently went through its annual budget exercise. Every year, the Government has the ability to modify tax rates and prices it will charge on products and services from public sector undertakings.This is very different from the US, where tax rates are considered sacred, and changing them is an extra-ordinary process. One populist measure for politicians is run on platforms of not raising taxes.

Both systems - virtually fixed tax-rates, and annually-changing tax rates create behavior patterns. In the case of the India, consumers and businesses may sometimes wait for the next year, hoping that tax rates may become beneficial for them. In the US, businesses build their structures around existing tax rates, and find it difficult to adjust to changing tax rates, or for that matter, to other conditions.

In these days of "Who stole my cheese," and agile development environments, who do we think is better suited for long-term successes - those businesses that are static, or the rolling stones that gather no moss?

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If you would like to read more on the budget process, here are two references.

If you want to understand more details about India's budget, here is a writeup on the philosophy India's Budget Process (in Theory). Rediff.com gives the stages of the budget process.