It doesn’t empower the common man
Chattar Singh
Finance minister Arun Jaitley has failed miserably to address the concerns of the common man in his annual Budget presented before Parliament on February 29.
The common man is concerned about his income-tax deductions, rising prices of essential commodities and annual savings. The Union Budget offers nothing that could add to his income.
After facing humiliating defeat in both Delhi and Bihar Assembly elections, the Bharatiya Janata Party-led government has drafted this Budget to hold on to its dwindling votebank in the states that will be going to polls this year.
There is no way of differentiating the low-income groups from the high net worth individuals. Given that the hike in the basic income-tax exemption was done two years ago, everyone expected an increase this year.
A bigger disappointment is the tax slabs that have not been revised. They were last revised in 2012, when the highest, 30 per cent tax slab, was raised to over Rs 10 lakh. Last year, the service tax was first raised from 12.36 per cent to 14 per cent in February and was again hiked to 14.5 per cent in November.
Again, the service tax has been increased to 15 per cent. That means prices of each and every item, including eating at restaurants, are bound to go up. The increase of the price of diesel by Rs 1.47 per litre is going to jack up prices of commodities that are transported through diesel-run vehicles.
Mr Jaitley has proposed one per cent excise duty on gold and studded jewellery besides introducing two per cent excise duty on ready-made garments with retail price of Rs 1,000 and above. That means consumers will now have to pay more to buy gold, platinum, diamond-studded jewellery and readymade garments.
The common man generally purchases gold jewellery for the marriage of his or her children. Also, these days most people go for branded clothes. Which branded shirt or trouser will cost you less than Rs 1,000?
By introducing “infrastructure cess”, car prices across categories — right from the entry-level Maruti Alto that gets dearer by Rs 3,000 to Toyota Fortuner which is now expensive by at least Rs 76,000 — have shot up.
Even airfares are bound to go up as Mr Jaitley has proposed a hike of six per cent on turbine fuel. The government has hit the common man below the belt by proposing to tax 60 per cent of the corpus of the Employees’ Provident Fund at the time of withdrawal on prospective basis. So, your retirement savings will also be taxed from next financial year.
Mr Jaitley has simply changed the tax policy for EPF contributions from April 2016 by restricting tax-free withdrawals to 40 per cent of the corpus and mandating that the remaining amount be taxed unless it is used to buy annuities.
In addition, employer’s contribution of over Rs 1.5 lakh will not get tax breaks. There is also no pension hikes for elderly and widows. No special incentives have been given to students and women. Thus, the Budget has no clear roadmap to empower the common man and take the economy forward.
Chattar Singh is leader, Delhi Congress
It favours people, not corporates
Vijender Gupta
Union Budget 2016 has gone beyond being a document on annual earnings and expenditures to a transformative exercise that aims to invigorate the rural economy with sound fiscal management. For the first time a government has reflected the pulse of the most vulnerable in its Budget proposals and shown its commitment to draw out a significant section of society from poverty.
The Budget is an out and out statement on the government’s intent to eliminate the growing disparity between the haves and have-nots. The Budget speaks to the common man and talks about his aspirations that would shape the nation’s economy in the times to come. The Union government has made it clear that big corporates will not take the economy forward. Rather, 1.25 billion Indians together will drive India’s growth story.
The proposed structural changes in the agricultural sector come at a time when an alarming number of farmers are committing suicides over crop failure due to an unpredictable monsoon and years of institutional neglect. A budgetary boost to the Pradhan Mantri Krishi Bima Yojana and Pradhan Mantri Krishi Sinchai Yojana will prove to be game-changers. The former provides a safety net from the vagaries of monsoon, while the latter ensures a productive yield resulting in higher rural incomes. Increased funds for enhancing rural road connectivity and rural electrification, higher allocation for the MGNREGA, unified agricultural e-market platform to eliminate middlemen and ensure better prices for farmers would be instrumental in realising the Prime Minister’s vision of doubling farmers’ income by 2022 as well as giving way for a self-sustaining rural model.
A scheme to provide LPG connections to women of almost five crore BPL households over a period of two years comes as breath of fresh air. Further, linking the benefits of distributive justice with the statutory-backed Aadhaar platform would plug the leakages and guarantee better targeting of resources.
The Budget lays out the government’s plan to extend 100 per cent tax exemption to start-ups for three years and allocate Rs 500 crore for SC/ST and women entrepreneurs under the “Start-up India” initiative. The manufacturing sector is set to get a major boost by the increased allocation of Rs 1.80 lakh crore in the Mudra scheme that caters to the small and medium enterprises, contributing an estimated eight per cent of the GDP, 45 per cent of manufacturing output and 40 per cent of exports. The government-funded health coverage of up to Rs 1 lakh per family will open up the private sector to the economically weaker section.
Notwithstanding the Opposition’s accusation, the government has protected the interest of the middle class that will gain from a resurgent economy. First-time home buyers and those paying rent in urban centres are set be the biggest gainers from the people-friendly Budget.
It can be confidently said that the Budget addresses various aspects of human well-being and social justice for a large section of the population. The Budget has shown that this government is sensitive and responsive to the needs of the common man and is not a tool in hands of a few business houses.
Vijender Gupta is the Leader of the Opposition in the Delhi Assembly
