Corporate tax cut by Centre suggests economy in a mess: Gogoi

Slamming the Centre for reducing tax for domestic companies, former Assam Chief Minister Tarun Gogoi on Saturday said the corporate tax cut confirms that the country's economy is in a "complete mess".

Senior Congress leader also criticised Union Finance Minister Nirmala Sitharaman, saying that the lowering corporate tax shows her "immaturity and wrong assessment" about the economic situation.

"The tax cut on corporate houses confirms the economy of the country is in a complete mess and shows her immaturity and wrong assessment about the economic condition," Gogoi said.

The BJP government's demonetisation move and the "wrong and hasty implementation of the GST" are mainly responsible for the economic slowdown, resulting in a large scale unemployment, agrarian distress and hardship of all sections of people, particularly the lower and middle class.

"The tax reduction is in favour of the corporate houses but I have doubts about how far these measures will boost the economy of the country and reduce the hardships and sufferings of people," Gogoi said in a statement here.

In a major fiscal booster, the government had slashed effective corporate tax to 25.17 per cent inclusive of all cess and surcharges for domestic companies. The new tax rate will be applicable from the current fiscal, which began on April 1.

Sitharaman had said the revenue foregone on reduction in corporate tax and other relief measures will be Rs 1.45 lakh crore annually.

Gogoi also accused Prime Minister Narendra Modi of lacking the "capacity to assess the real economic situation".

"The Prime Minister claims that he belongs to a poor family and is very much concerned about the poor but his response to their problems seems to be sluggish. On the other hand, whenever big corporate houses raise the issue of incurring losses, he quickly feels their pain and comes to their rescue but we have not seen such bold and prompt response in case of common public," he said.

The government should provide relief in taxes and provide incentives to all sections of people including farmers, small and medium entrepreneurs, he added.