Today, while perusing the ET, went across an article – whereby – Finance Minister Jaitley was preparing list of Fiscal exemptions & deductions – which would be abolished in near future.
Now, either this is a GROSSLY unwise fiscal weak step or is intended to serve some vested interests – of certain corporate groups – possessing an affinity to power centers at Delhi.
Erstwhile, under Manmohan Singh/Chidambaram, relief under fiscal laws or deductions from fiscal liabilities were granted – SOLELY ON MERIT – i.e. had a correlation with the impact on growth of weak economic sectors or for inducement towards a particular way of economic activity.
All such deductions were based on fiscal stipulations like on various factors like – investment in new plants, new FDI incoming to boost economy or establishing of hotels etc real-estate in under-developed areas of the country. Like, for example, Sections 80 IA, IB, IC etc, there used to be deductions of fiscal liability – in case a new real estate project was established in north-eastern hilly states – which prompted growth of infra in the respective areas – hence, in other words, deductions were with specific aim and vision.
However, its absolutely astonishing to witness – BJP under Modi – granting relief of fiscal liability – without conditions! Hence, there would be no inducement to setup new infra or economic activity in specific areas of economy or under-developed parts of the country!
This seems display of vested interests and hint of crony-capitalism at play!
'The Column' (since 2010) is a Member's Column written by Ankit Bhatia 