Parliament today approved a legislation to legalise funding of political parties by corporate houses and make it more transparent with the Rajya Sabha passing the measure by a voice vote.
The Election and Other Related Laws (Amendment) Bill 2003, passed by the Lok Sabha earlier, was approved by the Rajya Sabha today.
Replying to a debate on the Bill, Law Minister Arun Jaitley said this Bill in no way legalised corporate donations or corruption in the political system but was meant to infuse accountability in the entire process.
Speaking during the debate, Congress leader Pranab Mukherjee claimed a great deal of the credit for the suggestions incorporated in the Bill that were made by the House standing committee.
Mukherjee said in 1985, the issue of lifting the ban on corporate contribution to political parties was mooted, but the modalities could not be worked out.
The proposal made then was that companies should be entitled to donate 5 per cent of their three-year annual profits. But the response to this was not good because there was no incentive for corporates.
Also this had to be passed by shareholders who felt this made companies hostage to political parties.
However, by introducing the tax incentive in the current Bill, the corporates would be more forthcoming in making political contributions.
Mukherjee also said there was a repeated demand for state funding.
But this Bill effectively did provide for state funding - the tax break to corporates would go out of revenues the government would normally have earned.
Direct broadcast time offered on television channels also represented revenue. Also the printing and supply of voters