INTRODUCTION:
News about a Belagavi woman and her husband on the way home who was fined $500 for riding without a helmet, they said that they had no cash but the traffic police insisted that they pay. In a fit of rage, the woman removed her mangalasutra and told the officer to sell it and pay the fine[1]. Now imagine a CEO of a corporate company being fined the same amount, it would be a mere inconvenience for him, something not worth remembering. This highlights a very important issue that needs to be addressed.
Especially in a developing country like India, where most of the population are farmers and other wage workers. Poverty is a critical part of everyday life for half the population and issues like these are integral which affects their lives. As their wages fails to cover three meals a day, when civil fines are imposed for simple misconducts like not having helmets, it punishes the poverty instead of their bad behaviour.
FINES AND THEIR PURPOSES
Fines are monetary penalties ordered by the state or authority to pay a sum of money fixed by the law for an offense committed or for a rule broken. Fines are an alternative to harsher punishments like imprisonment used in various fields of law like civil and crime. These fines act as a deterrent to crimes while also being a revenue generator. Depending on the intensity crime, the amount of the fines varies.
For individuals, fines are to maintain public peace, make illegal activities more expensive, and deter people from violence against the public like parking fines or traffic fines. For companies, fines are for complicated reason that threatens their profitability for the noncompliance of law on topics like tax evasion, environmental pollution, or labour rights.
However, the effect of fines will depend on the consequences created for the offender. This is where the system fails, as it assumes all individuals have an equal financial situation, which is far from reality. Thus, for corporates, fines are a part of business especially when these fines are of marginal amount when compared to the profit earned. Similarly, for high-income individuals, fines are a cost of breaking the rule. Thus, creating disproportionality in the treatment of different groups of people.
ECONOMIC DISPARITIES
As fines impose monetary penalties on all people irrespective of their social status, they may seem fair at first glance. Disparities arise when we look through the income lens. The poor are affected because these fines take up a significant amount from their paycheck, while the wealthy are not affected, and nor have their behaviour been challenged.
Several companies opt to pay fines rather than spend money on proper sewage treatment. Southern Water, in 2021 was fined 90 million dollars for dumping raw sewage into the ocean. One of the reasons is that the sewage treatment plant is costlier.[2] These create complex trade-offs, of cost for compliance and cost for non-compliance. Thus, these become a predictable expense that is budgeted into their business. As the gains outweigh the fines, they frequently break the laws.
The difference are also seen in late payment of fines, as wealthy people have the means to pay fines immediately and aren’t affected by financial burdens. In contrast, those who cannot pay fines face even more escalating fees, compounding their financial burden.
IMPACT ON LOW-INCOME INDIVIDUAL
The imposition of a fine which might be negligible for an individual with a moderate to high income can have financially devastating consequences for low-income individuals. A seemingly minor fine can trigger a cycle of poverty in families with limited financial resources, as they are compelled to allocate a portion of their already scarce funds to pay off the fine. When these individuals can’t pay the fine, the situation spirals out of control, rendering it increasingly difficult for them to get out of the escalating debt.
Financial difficulties resulting from unpaid fines can have far-reaching consequences, creating a cascade of adverse effects, including job loss and housing instability. Furthermore, failure to settle fines in a timely manner can escalate the initial penalty, thereby perpetuating a cumulative effect. Unpaid fines can also compound additional penalties, such as suspending or revoking a driver’s license, issuing arrest warrants, or even imprisonment.
In some instances, individuals may continue to drive without a valid license, due to the revocation of their license, which can result in further fines and penalties when they are caught. Millions of people confront these challenges daily, where a single traffic fine can start a chain of events that includes the loss of a driver’s license, job loss due to the inability to commute to work, and further disruption of their lives.
For low-income individuals, a fine can trigger a cascade of problems. Their inability to pay it can result in the imposition of late fees, the suspension of their driver’s license, or even jail time, which can create a vicious cycle of poverty. In contrast, wealthier offenders rarely face these cascading consequences, as they can pay their fines without difficulty and hire legal representation, thereby leaving the poorer segments of the population to shoulder the burnt of this inequity.
LEGAL CONSIDERATIONS
Fines are meant to deter misconduct and enforce societal rules, however, in practice, they disproportionately penalize poverty rather than bad behaviour, effectively criminalizing financial hardship. These monetary penalties further perpetuate systematic inequality rather than providing true justice. In the US, the Eighth Amendment of the United States Constitution explicitly prohibits excessive fines, so that individuals aren’t discriminated against based on their financial status.
In India, The Motor Vehicles Act, 1988 (amended in 2019) imposes Rupees 5,000 for driving without a license or imprisonment for 3 months.[3] While these fines may seem appropriate for the deterrence of careless behaviour, they fail to take into account the financial inequalities of the people, as monetary penalties don’t carry the same weight for all individuals.
Similarly, under section 436 A of the Code of Criminal Procedure, which deals the maximum period for which an undertrial prisoner can be detained, which is one half of the maximum sentence of that offense[4], low-income individuals remain imprisoned for longer duration due to their inability to pay the said amount, invariably punishing them for their poverty, as opposed to high-income individuals, who treat the fines as expenses to spend minimal jail time.
The ethical principle of proportionality suggests that penalties should reflect both the offender’s ability to pay and the severity of the crime committed. When fines are imposed for revenue collection rather than deterrence, they erode the public’s faith in the justice system.
ALTERNATIVE APPROACHES AND REFORM
To address these inequalities, numerous reforms have been adopted. One such is called the day fine also known as income-based fines which are implemented in countries like Finland and Germany. Where these systems calculate fines as a percentage of the offender’s daily income, ensuring penalties are proportional to financial means. For example, a speeding ticket can cost thousands of dollars of fines for a millionaire while remaining payable for lower-income individuals.
In addition to this, offering community services as an alternative to flat-rate fines or even eliminating additional fees for late payments or the eliminating of fines for minor offences as implemented in California. Technology can also play a role by simplifying the sliding scale fines, using automated income verification, and making them more effective and accessible.
CONCLUSION
The current system of fines deepens the inequity present between the income groups instead of enforcing order and justice as they punish those who are already struggling. We must reassess our approach towards fining to form a system that is separated from financial status. As it’s our inherent right to be treated equally irrespective of our social or financial circumstances.
To reduce economic inequality, the fining system has to be reformed. Flat-rate fining affects low-income individuals while barely impacting the wealthy. To promote social equality, this issue has to be addressed, to make sure that the justice system serves all and not just a specific group of people.
Author(s) Name: Sharadha (SASTRA University, Thanjavur)
References:
[1] ‘Karnataka: Belagavi Woman Offers Mangalsutra for ₹500 Traffic Fine, Video Goes Viral’ The Times of India (27 February 2021) < https://timesofindia.indiatimes.com/city/hubballi/karnataka-belagavi-woman-offers-mangalsutra-for-500-traffic-fine-video-goes-viral/articleshow/81239687.cms> accessed 9 February 2025.
[2] Sandra Laville, ‘Southern Water Fined Record £90m for Deliberately Pouring Sewage into Sea’ The Guardian (9 July 2021) <https://www.theguardian.com/environment/2021/jul/09/southern-water-fined-90m-for-deliberately-pouring-sewage-into-sea> accessed 9 February 2025.
[3] The Motor Vehicles Act, 1988 (amended in 2019), s 63
[4] The Code of Criminal Procedure, 1898, s 436A
