Many times, I come across Corporate Employees complain that Businessmen are better off because they probably cheat on their taxes, whereas they have no leeway. After all, they receive their compensation after taxes have been deducted.
This is to a certain extent true in India where we see poor tax compliance by businesses who claim deductions under some expense head or other. This type of circumvention of tax rules creates a culture within Business Families that if a Business generates incomes, then we should create expenses that can be unethically charged to the business or worse, if the business generates black income, we should spend it, lest it get caught in an Income Tax raid. In either way, I see black incomes driving conspicuous consumption in the form of expensive second-hand cars, foreign vacations with huge shopping bills and extravagant holidays often paid for in cash.
On the other hand, I see most Corporate Employees embrace frugality, save aggressively and build wealth. This to my mind is the natural consequence of generating tax-paid income and valuing it enough to be more mindful about spending it.
My advice to businessmen is to relook at the entire chain of generating undisclosed income, avoiding tax and then feeling pressured to spend the income. Their economic future will be better if they make attempts to break this self-fulfilling cycle.