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The Centre’s recent move to slash the interest rate on various small saving schemes such as Kisan Vikas Patra and Public Provident Fund drew flak from the Finance Standing Committee, which termed it as a kind of ‘double taxation’.
Members, cutting across party lines, told representatives of the Finance Ministry that the move will harm the salaried class, as they questioned the Centre’s decision to reduce the interest rates of such schemes.
‘Salaried class under pressure’ Speaking to BusinessLine , a member of the panel said: “Some members said it is like double taxation. On the one hand, the Centre is trying to expand the ambit of taxation and on the other hand, they want to reduce the interest rate on their savings. What will the salaried people do? Where will they go?”
The Ministry, however, has not responded to the concerns raised by the members.
“Usually, they take note of our views and get back in the next meeting. We hope that the Centre will revoke its decision,” an Opposition MP said.
During its two-day meeting, the Committee, headed by veteran Congress leader Veerappa Moily, also raised the issue of various cesses collected by the Centre and its disbursal to States.
‘Distribute cess’ “The Centre has not provided the correct figures of various cesses collected so far. A Comptroller and Auditor General report had noted that thousands of crores of cess money collected is lying idle in the exchequer. We expect the Centre to distribute this money to States at the earliest,” one of the members said.
Concerns were also raised about the 1 per cent additional excise tax on non-silver jewellery. “We are not against imposing a luxury tax on the jewellery, but it should not be at the cost of small traders,” a member said.
The Committee will submit its report in the next phase of the Budget session, which is scheduled to begin in the last week of April.
Officials from the departments of Revenue, Finance, Expenditure, NITI Aayog and Customs participated in the meetings and presented the Centre’s stand on the demands for grants of these departments.
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