And now, a democracy cess to fund elections?

Industry body CII moots legalising political funding, seeks 0.2% cess on all tax payers, including companies

A task force, set up by industry body CII, has recommended legitimising political funding and sought imposition of a "democracy cess" of 0.2% on all income tax payers, including companies, for funding political activity and elections in the country.

The Confederation of Indian Industry (CII) Task Force on Electoral Reforms, which presented its report to Chief Election Commissioner S Y Quraishi here today has also recommended that the cess be paid directly by the tax payer through cheque into the account of any political party of his or her choice recognized by the EC.

"The full amount of cess or part thereof to the extent not paid to any political party will be paid to the government as a part of income tax payment which will accrue to an "electoral/political pool fund" which the Election Commission will utilize to support legitimate political activity.

"Let the income tax payers decide which party they wish to support. The option of giving to one or more parties, or to the pool fund would be that of the income tax payer," the report task force states.

It further suggests that the amount paid to a recognised political party by cheque on account of democracy cess shall be given 100 per cent weighted deduction from the respective tax liability, but this deduction would be applicable only to the extent of 0.2% cess applicable to the tax payer and the excess amount will not be eligible for weighted deduction.