Financial Daily from THE HINDU group of publications
Friday, Jul 09, 2004
Industry & Economy - Taxation
Columns - Detaxfication
Watch out as the government shifts gears and piggybacks
PC is, however, not too enthusiastic about presenting a Budget after one-quarter of a year has elapsed, because "by the time the Budget is passed and the President gives his assent to the Finance Bill, nearly one-half of the year will be over."
Yet, there is enough time for a quick thumbing through his speech.
Let's shift gears
PC is in good hurry. "The government has to shift gears," he says.
"Even if we are able to do so quickly, it would leave us only about six months to achieve our objectives for this year."
So, they are redrawing priorities. Which means as the FM moves to overdrive mode, some old baggage will fall off.
Any Budget document is a fertile ground for abbreviations, and PC is no exception. We are already familiar with UPA, NCMP, GDP and so on. FRBM is not a ballistic missile, you should know; it is the Fiscal Responsibility and Budget Management Act.
GBS has nothing to do with geo-stationary satellite, but gross budgetary support. SGRY, SGSY, SJSRY, REGP and PMRY look very much like potential SMS usages, but they aren't.
The Minister knows you're confused. "While preparing the Budget, I found that there is a plethora of Plan schemes," he says.
"The number, the variety and even the acronyms under which these schemes are known are mind-boggling."
This Budget has an elaborate essay on water, because it is one of PC's "big dreams". It is "the lifeline of civilisation," he notes. So, everybody, the new job is to "repair, renovate and restore all water bodies." That would cost money, you wonder. "Funds will not be a constraint for implementing the project," assures the FM.
`Gender budgeting' is a heading that should have foxed many. What's that? He explains: It means that Budget data should be presented in a manner that the gender sensitivities of the budgetary allocations are clearly highlighted.
This needs a proper "classification system of government transactions" for which work is going on.
Next year's Budget may throw more light on this.
There's more than the `Main Hoon Naa' jest by PC and what the Speaker said at one point about only a few more pages left.
Such as: "One of our greatest assets is our human resources, our people. Progress is not always on a linear path, nor is it inevitable. Government intends to piggy-back on the public issue of NTPC and disinvest approximately five per cent of its holding."
Novel or fiction
The method that the FM adopted to "give relief to 1.4-crore assessees" is "somewhat novel".
But many got caught in a fiction of a sudden bonanza of Rs 9,000, applying tax rate on income up to Rs 1 lakh.
As for now, the message is simple: File your return "according to the current tax slabs and tax rates, and compute taxable income and the tax payable"; anyone with a taxable income of Rs 1 lakh will have his income tax liability automatically rebated.
Please understand, he "cannot give more relief, or relief across the Board, in this Budget".
Here is his promise: "If compliance improves, I promise to revisit the subject."
It's tough to draft a long speech without a few tough lines, such as:
"Elimination of revenue deficit will open up fiscal space up to 3 per cent of GDP for enhanced public investment without undermining fiscal prudence... Sequencing the measures in an appropriate fashion and continuing the reform process, which ushered in the era of rapid growth, are the main challenges...
"The Government is committed to strike a fine balance among the three mutually reinforcing objectives of growth, stability and equity."
"We have a choice!"
"To cheer or not to?"
"No, to become a farmer or grow poor."
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