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While I agree with the general assessment of the former Finance Minister in the article “Goodbye Mr Chidambaram” (Business Line, December 4), it is difficult to agree with the credit given by the author to Mr P. Chidambaram for the tax cuts and their rationalisation.

The dividend tax is increased to 15 per cent. Along with this, the surcharge, additional surcharge and educational cess, the corporate tax comes to 51 per cent. Instead of increasing the administrative work and also add to the trouble of the assessees, to be honest, the corporate tax could have been increased from 30 per cent to 40 per cent or any level of his choice.

In addition to this, obnoxious taxes such as the Fringe Benefit Tax, Service Tax, the latter at an exorbitant rate of 12.36 per cent, etc., have further increased costs.

There is no clear Act or governing rules for the administration of service tax. It is very vague and its implementation is left to the whims of the Department and is being extended to imaginary services.

T. A. Rajagopalan Chennai

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