Sandeep Dikshit
Tribune News Service
New Delhi, February 2
Union Finance Minister Nirmala Sitharaman today said that widespread scepticism after the budgetary announcement of an alternate income tax regime was because of lack of clarity as the government had not immediately come up with an explanatory note. The “deep cuts’’ in I-T slabs, she was confident would benefit the middle and lower middle classes.
Sitharaman implied that some calculations in public domain that suggested the new scheme would lead to more taxes were wrong because they had not accounted for the fact that it also allowed some exemptions. “If the new scheme will eventually result in people paying more, why will I come up with such a system,’’ she asked in an interaction with select mediapersons.
On EXEMPTIONS
The compulsion to invest in exemptions is outdated. The government is now giving the taxpayer option to do what he wishes with the money in his hands after paying taxes.
The Finance Minister felt that the compulsion to invest in exemptions was outdated, now that the country had given up on the socialist model of economy. The government was now giving the taxpayer the option to do what he wished with the money in his hands after paying taxes.
The withdrawal of a large number of incentives would hit some sectors but the extra money in the hands of the individual would be a catalyst for economic activity in some other sectors, she argued. “This worry need not be there. It is (the money) not being thrown into the sea.”
ON FARM SUBSIDY
We don’t want overtly chemical fertiliser-driven crops. We need to review the incentives for chemical fertilisers. That correction is required for farmers to move to organic fertilisers.
Nirmala Sitharaman, Finance minister
Asked why the government had given the taxpayer the option to choose between the existing and the proposed schemes, Sitharaman replied that she would have been labelled “authoritarian” if she had not done so. She denied that reduced fertiliser subsidy was a disincentive for farmers. “The government’s paramparagat (traditional) scheme is based on organic farming. Even consumers are showing interest in organic. We don’t want overtly chemical fertiliser-driven crops. So we need to review the incentives for chemical fertilisers.
That correction is required for farmers to move to organic fertilisers,’’ she reasoned.
The Finance Minister claimed she didn’t have a specific constituency in mind while framing the Budget. “On the contrary, I was open to every constituency which needs something. I didn’t go through a sectoral approach. We were looking at economy largely and the way in which macro fundamentals being what they are, the budgetary proposals were how to go forward,’’ she reasoned.
There were many demands not just from the markets but also rural India, MSME and several others. “I tried to accommodate some, could not accommodate many others,’’ she acknowledged. On missing the disinvestment target, Sitharaman wished she had full 12 months last year as it was impossible to “reduce the necessary, legitimate time that is given to people to consider before putting in their bids.”