MPs urge Chidambaram to focus on middle class in Budget

Amid talks of taxing the super rich more, members of Parliament (MPs) today urged finance minister P Chidambaram to focus on the middle class in his February 28 Budget speech and said the tax network should be made broad-based.

In this year’s first meeting of the consultative committee with Chidambaram, some MPs suggested the Budget be “practical, reasonable and visionary”. The MPs sought incentives for the youth, saying home loans could be provided at a cheaper interest rate for the youth under the age of 35 years.

Further, the scope of the Mahatma Gandhi National Rural Employment Guarantee Generation Scheme, the Central government’s flagship rural job programme, should be expanded to include creation of human assets, along with physical assets, in the rural areas, they said. Inclusion of fertiliser and seed subsidy under the direct benefit transfer scheme “at the earliest” was also suggested.

“It (the Budget) should focus on water conservation and urban renewable by tackling both environmental and physical degradation in this area,” a finance ministry statement said, quoting the Parliamentarians.

Some members said the government should give incentives to small agro-based and food processing industries in rural areas to create more job opportunities, which would help in tackling the problem of migration from rural to urban areas. Rural infrastructure should also be given priority to achieve the same objective, they added.

Providing drinking water facilities, tackling garbage problem and sewerage related issues and ensuring basic facilities of health and education in rural areas are in high priority for the MPs.

Suggestions were made to enlarge the scope of the Pradhan Mantri Gram Sadak Yojana (PMGSY) and the Rajiv Gandhi Grameen Vidyutikaran Yojana to include small village hamlets under the schemes rather than covering only revenue villages.

PMGSY is a nationwide plan to provide road connectivity to unconnected villages, while the latter’s goal is to create rural electricity infrastructure.

MPs said there was a need to reduce the number of the centrally sponsored schemes and turn the focus to quality of execution. They cautioned against hijacking of centrally sponsored schemes by the state governments.

Suggestions also included giving relief from dividend distribution tax to the Indian companies that have set up subsidiaries overseas and want to bring dividend back to the country.

Relief from excise duty on 14-inch colour television sets below the cost of Rs 2,000 was also sought. They further sought a cut in service tax on food items, clarification regarding service tax on storage of food grains and customs duty relief on sports equipment.

Members of the consultative committee who participated in the meeting included Anto P. Antony, Narahari Mahato, Partap Singh Bajwa, Neeraj Shekhar, Suresh C. Angadi (all from the Lok Sabha), Ajay Sancheti, Birender Singh and Rajkumar Dhoot (from the Rajya Sabha).