Stop labour reforms in name of ease of doing biz: Unions to govt

Vibha Sharma

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Tribune News Service

New Delhi, January 4

The government’s “too much romance with corporates is creating colossal loss to the social sector”, the Bhartiya Mazdoor Sangh, a labour union affiliated to the RSS, today noted as Finance Minister Arun Jaitley started pre-Budget consultations with different stakeholders ahead of his second full-year Budget in February.

In fact, a joint memorandum by different trade unions, including the Sangh affiliate, marked to the Finance Minister advised the government to “stop the process of labour reforms in the name of ease of doing business”. We oppose the hectic measures of changing labour laws by the central as well as some States, trade union representatives, including from CITU, INTUC, AITUC, HMS, AICCTU, AIUTUC and SEWA, said.

According to the unions, instead of depending on foreign funds for growth and development of the national economy, the government should concentrate on raising internal resources for funding the developmental schemes and welfare programmes and by taxing those who have capacity to pay instead of drastically reducing the allocations on social sector and basic services like health and education.

The government must take firm measures to contain deliberate tax-default by the big business and corporate lobby leading to huge accumulation of unpaid direct tax dues, they said.

While making strong observations about the BJP government’s economic policy “subsidising the rich and taxing the poor” and “drastic cut to the tune of Rs 4.40 lakh crores made in the allocation of funds for social sector schemes” in the Budget last year, the BMS separately cautioned the government on rising prices, its taxation policy and concessions to corporates.

“Indirect tax was increased which is borne by the common man and direct tax was reduced which is borne by the high-income group. Corporate tax was reduced from 30% to 25%. Plethora of concessions and exemptions were given to corporates and big industries.”

“Fundamental approach to tax collection is, collect tax from the rich and subsidise the poor. But now in the globalised era it has become just the opposite. Government is subsidising the rich and taxing the poor. The common man is funding the government through the indirect taxes whereas Indian corporates are given all types of concessions and exemptions. Consequential revenue losses are reducing the social sector spending.

“Thus government’s too much romance with corporates is creating colossal loss to the social sector. Further, there is deliberate tax-default by the big business and corporate houses leading to huge accumulation of unpaid direct tax dues which has already crossed more than Rs 5 lakh crore on direct and corporate tax account alone. Their share of NPA is rising. Forty per cent of foreign debts are commercial loans taken by the corporates. Neither the corporate sector is improving their role in national economy nor the social sector is benefitted,” it said.

Expressing opposition to FDI again, the BMS maintained that the idea that FDI was a panacea for all economic maladies has to be discarded. “Manufacturing, industrial, agricultural and service sectors have to be strengthened.”

“People have voted this government to power for bringing change. Hence people need to be convinced about the direction of the change. There is a gross mismatch between the aspirations of the people and the slow progression of social transition. Paltry concessions or charity in the budget cannot change the economic condition of the people,” it said.