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New I-T system can have adverse impact on taxpayers’ savings, says RSS affiliate SJM

New Delhi, Feb 3 (IANS) While expressing satisfaction over growth orientation in the Budget, with focus on rural development, infrastructure and MSMEs, RSS affiliate Swadeshi Jagran Manch (SJM) impressed upon the Centre to tweak the tax regime to promote saving by the middle class, which is an important source of government borrowing and capital formation.

The SJM also urged upon the government to increase tariffs on products where there exists sufficient excess capacity, aimed at promoting manufacturing in the country by curbing imports from China.

Dr Ashwani Mahajan, National Co-Convenor, SJM said that as expected, the income tax burden (in the new tax regime) has been reduced for the middle class, including for ultra rich, which will have an impact on the total revenue of Rs 37,000 crore.

“Swadeshi Jagran Manch believes that the new income tax system may give relief to the tax payers in terms of ease in filing returns, with lower tax burden; but it can have an adverse impact on the savings being made by income tax payers. In today’s era where GST has gone out of the ambit of the Budget; and hardly much possibility of any tweaks in corporate taxation, the allocation of government expenditure is more in the eyes of economic analysts,” he said.

No doubt, the allocation of government expenditure is the mirror of the policies of the government; and that is perfectly reflected in the Budget. In that context, SJM expresses its happiness over the allocation for infrastructure, rural development, green growth, education and digitization in the budget,” he added.

The RSS affiliate said that unprecedented imports from China and trade deficit is a cause of concern.

“Although, it was expected that there will be an emphasis on manufacturing in this Budget, SJM expresses its dissatisfaction over lack of sufficient efforts, including hiking of tariffs on products, both final as well as intermediate products. Today the country is going through an unprecedented imports from China and trade deficit, but the same couldn’t catch sufficient attention of the Finance Minister,” said the SJM.

SJM said that carrying forward last year’s resolution, the share of effective capital expenditure (including support to state governments for capital formation) has been raised to Rs 13.7 lakh crore, which is 4.5 per cent of GDP.

“It will benefit infrastructure building and other types of asset creation. Capital expenditure of Rs 2.40 lakh crore for Railways, the provision of various types of capital expenditure, including logistics of Rs 7,500 crore makes this Budget special. This much capital expenditure is a record not only in terms of quantity, but also as a percentage of GDP in recent decades,” it said.

“Another welcome focus in the Budget is the MSME sector. Extending Credit Guarantee for MSMEs, giving relief to MSMEs who could not fulfil their contracts with the government by releasing their caution money, PM Vishwakarma Kaushal Samman scheme is a welcome step for empowering artisans, who are at the bottom of the pyramid,” said the SJM.