FM urged to increase outlay on Agriculture

Allahabad, Feb 14 (UNI) Noted economist Kripa Shankar has sent a memorandum to the Union Finance Minister urging him to substantially increase the outlay on agriculture, irrigation, watershed development and rural employment generation schemes.

Dr Shankar, teaching at the Govind Ballabh Pant Social Science Institute here, said, ''The foodgrains production was continuously stagnating and per capita availability of foodgrains at present is also not what it used to be 50 years back. Their prices are rising which would increase the hardships of the poorer section of the society.'' He wrote in the memorandum: ''Over the years, the government has been relying on borrowings to finance its expenditure rather than taxing the affluent which has led to huge indebtedness.

Annual repayment of debt and interest payment at Rs 3.9 lakh crore is only marginally lower than the entire revenue receipt of Rs four lakh crore with the result that the government has to borrow Rs 1.5 lakh crore annually, further accenturating the indebtedness which has crossed Rs 20 lakh crore forming two thirds of the entire Gross Domestic Product (GDP).'' Through liberalisation, the income and wealth of richer classes has witnessed an unprecedented growth. The 10 per cent wealth of top ten people has been estimated to be more than the wealth of bottom 70 per cent of the households but wealth tax has been abolished, Dr Shankar added.

He said the market value of shares held by them exceeds the total value of GDP. Daily turnover of shares exceeds Rs 7,000 crore but what the government gets through securities transaction tax is Rs 3,500 crore.

He maintained the income tax rate on the highest slab of income is 40 per cent in the US and the UK, 45 per cent in China and 50 per cent in Japan but it is only 30 per cent in India with many exemptions.

Corporation tax in India is 30 per cent but exemptions have brought its incidence to 23 per cent. ''It has been officially admitted that the exchequer loses are more than Rs one lakh crore annually through those exemptions. If these exemptions are withdrawn, there will be no need for borrowing.'' MORE UNI JL ATI PV DS1353