Budget leaves salaried class high and dry

THE Union Budget has not evoked much enthusiasm among the common people. Nor are the industrialists ready to accept it as “transformational” in anyway. The entire Budget seems to be a “laboured one”. It may be “politically correct”, yet it fails to assure the masses about their welfare.

The salaried class has been left high and dry with a small amount of tax relief of Rs 10,000. Now standard deduction for male servicemen is Rs 1,10,000. Government employees were expecting it to be raised to Rs 1,50,000 as they have been experiencing the huge burden of rising prices and the negative impact of the ever growing inflation which is above 6 per cent.

Union Finance Minister P. Chidambaram sounded quite honest when he told the nation that the aam admi government “had done little to boost the farm sector, in which 115 million families are dependent”. In fact, thousands of farmers have committed suicide in Maharashtra, Punjab, Madhya Pradesh and Uttar Pradesh, and the agricultural crisis has gravely deepened.


It is expected that the Finance Minister will implement his plan of providing credit facility to 50 lakh new farmers in the next fiscal year. The economic growth rate has been 9.2 per cent for 2006-07, the exports have grown by 36.3 per cent and our foreign exchange reserves have touched Rs 180 billion. Yet, the rising prices of essential goods have made the life difficult for common people.



The budget is listless as it is devoid of three basic requirements. Mr Chidambaram does not tell us about the actual transmission of funds vis-à-vis provisions made during the previous year and the impact on the nation. For example, he provided Rs 10, 000 crore for health sector last year. But he does not tell if the funds actually spent reached that figure or not and the shortfall.

The provision of funds must be co-related with the requirements needed to meet the targets of the corresponding year in the Five-Year Plan document or any other programme. It is silent about the status of achievements of the Bharat Nirman Programme.

The six basic factors which only can catapult the nation out of the poverty trap are: population control; water resources development and hydro power generation; drastic cut in the heavy oil import bill ($ 50 billion this year); generation of 50,000 MW power at coal pit heads; at least 70 per cent sanitation in urban and rural areas; and infrastructure development.



The government is least bothered about the common man’s plight following the price rise. The IT sector does not need the Mr Chidambaram’s intervention when it was already given incentive by the Finance Act, 2000 for 10 consecutive years (Section 10A). Imposition of MAT at 10 per cent at this stage is neither desirable nor necessary.

The Finance Minister has done a great disservice to the corporate sector by retaining the surcharge of 10 per cent. In the name of widening the scope of Service Tax, he has gone too far in bringing the owners of commercial buildings within its net. These owners are already paying more than 50 per cent of income as various taxes.

The Finance Minister should have placed his house in order by bringing a comprehensive Service Tax Act without being governed by any Act. What prevented him in banning the future trading in food grains in time is still not known. Expenditure on providing security to VIPs could also have been reduced.

OM DATT SHARMA, Advocate, Chandigarh


The Finance Bill 2007 has included rent from immovable property rented for commercial purposes in the ambit of Service Tax Act of 1994. If an individual has rental income of Rs 10 lakh, he has been burdened of Rs 128750 of service tax and education cess thereon @12.5 per cent and 3 per cent.

He must also pay income-tax on the same income of Rs 10 lakh to the tune of Rs 175150, surcharge on income tax and education cess @ 3 per cent. The Finance Minister has charged service tax and income tax on the same income twice and also education cess twice. Is it not double taxation of the same income? The tax should have been charged only once and relief given to the taxpayer.


Lawyers’ quota

The Haryana Chief Minister’s announcement reserving 10 per cent HUDA plots for lawyers is welcome. It is suggested that out of this percentage, 3.3 per cent should be reserved for women lawyers. It should be effective in all cases in which draws are yet to be held.

Moreover, reservation should also be made applicable to private colonisers licensed by the government.


Bring law violators to book

Building bylaw violators are increasing by the day. The Ludhiana Municipal Corporation seems unable to check the distorted developmental activity in the city which has marred the landscape.

Even other facilities like clean environment, good roads and clean drinking water are not available. People violate the bylaws with impunity and no body cares for complaints. Violations thus ignored generate a new crop of offenders who also enjoy immunity from penal action. When these violators’ tribe is on the rise, the government comes with a formula to save them with a one-time reprieve.

Demolishing a structure, which violates the approved construction plan, is an exception whereas this should have been the rule since long. It is time to initiate corrective measures. It would be nice to dismantle the construction as soon as it is noticed with a stern warning to the culprits. Still, if the violation is repeated, the structure must be demolished immediately together with a heavy penalty to act as a deterrent.

Dr I.S. KALRA, Ludhiana



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