Search the Internet          Tips  Sites: Finance, Investment

BJP against lifting of tax exemptions

Bharatiya Janata Party's economic affairs chief Jagdish Shettigar warned on Monday that the Kelkar task force's suggestion for lifting tax exemptions, if implemented, could prove to be "politically costly" for the National Democratic Front government.

"We cannot accept the suggestion since it is affecting a large number of middle class (people) who form the bulk of our votes," Shettigar said in New Delhi.

"There might be economic rationale behind the suggestion, but one has to see political compulsions. Economic rationale and political compulsions do not go hand in hand," he said.

Shettigar said some of Kelkar's proposals would be opposed at the planned BJP national executive meeting in December.

The task force on direct taxes, headed by advisor to Finance Minister Jaswant Singh, Vijay Kelkar, had suggested far-reaching recommendations including lifting of standard deductions for the salaried tax class to nil and eliminating tax rebate scheme under Section 88 for savings.

Though he hailed the panel's suggestions on raising the exemption limit to Rs 1,00,000 from the current Rs 50,000, Shettigar said instead of removing tax concessions for the salaried class, such concession should be done away with in the corporate sector.

"In today's world of buyers' markets, there is no need to offer tax concessions to corporates when they invest in research and technology because it is their compulsion for remaining competitive."

ALSO READ:
Monetary & Credit Policy 2002-2003
More Money Headlines