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LATEST NEWS UPDATES | Cong smells farm tax

Cong smells farm tax

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published Published on Apr 30, 2017   modified Modified on Apr 30, 2017
-The Telegraph

New Delhi: The Congress today alleged that the Narendra Modi government was testing the waters on bringing agricultural income within the tax ambit and declared its intention to build a movement of farmers if the idea was implemented.

"This government is harassing industrialists, traders, students, political rivals... only one section of the society was left, that is farmers," Congress leader Ghulam Nabi Azad said.

"The statements coming from important people in the government are aimed at creating an atmosphere... they use such tricks to test the waters. Then they will implement the proposal."

When reminded that finance minister Arun Jaitley had already clarified that there were no plans to tax farmers, Azad said: "Why have two more statements come after the finance minister's intervention? First, this year's Economic Survey advocated taxation on agriculture. Then, Niti Aayog member Bibek Debroy stated that agricultural income should be brought under the tax ambit. Now, none other than the Prime Minister's chief economic adviser Arvind Subramanian has joined the chorus."

Debroy had said: "The eventual answer to expanding the base on the personal income tax other than elimination of exemptions is also to tax the rural sector including agricultural income above a certain threshold."

Subramanian was quoted as saying at a media interaction: "The legal situation was such that nothing prevented state governments from taxing agricultural income, though there was a constitutional restriction on the central government to impose such a tax."

Recalling that the Prime Minister had promised "input cost plus 50% Profit" to farmers before the 2014 elections, Azad said: "Farmers are committing suicide; there is drought in several states. The government raised the MSP (minimum support price) as a token gesture while the indirect tax paid by farmers in the form of diesel cess has been increased by a whopping 380 per cent. When the UPA was in power, in May 2014, excise duty on diesel was Rs 3.56 a litre. Today it is Rs 17.33 a litre."

Azad pointed out that even Reserve Bank of India governor Urjit Patel had said that farm-loan waivers were a bad idea that undermined credit discipline. "SBI chief Arundhati Bhattacharya had also earlier echoed the same. For the RBI, helping big corporates who take loans worth lakhs of crores (of rupees) is a good idea. Obviously, farmers can't bribe (and) give commissions."

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The Telegraph, 29 April, 2017, https://www.telegraphindia.com/1170430/jsp/nation/story_149078.jsp#.WQX4FNzhXIU


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