No tax on agriculture, but tax evaders won't be spared: FM

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SME Times News Bureau | 06 May, 2016
Finance Minister Arun Jaitley on Thursday outright rejected suggestions to tax agricultural income but warned of strict action against those passing off income from other sources as agricultural income.

"One is honest agricultural income. You may have a large income, which is a separate case. That is a rare case. But there are some cases where people are passing off income from other sources as agricultural income. This is a case of evasion. That will be dealt with under the law," Jaitley said in the Lok Sabha while replying to a debate on the Finance Bill 2016.

He rejected the demand for including those with higher agricultural income under the tax net, a suggestion made by Biju Janata Dal (BJD) member B. Mahtab and Saugata Roy of Trinamool Congress during Wednesday's debate.

Jaitley said: "The category of people earning from agriculture in crores (of rupees) is very little. In any case, please remember, under the constitution the Centre has no power. It is a state subject."

He however hastened to address Mahtab: "I would advise you not to advise your chief minister to levy it in Odisha. Though you have a right, but do not bring it in Odisha."

Mahtab protested by saying there is a "case pending" on the issue in the Patna High Court.

"A number of people are indulging in this type of activity, showing more than Rs.200 crore profit," the Cuttack MP said.

In response, the finance minister said he is "aware" of this and said that tax evaders will not be spared.

He also ruled out withdrawal of the proposed one percent excise duty on non-silver jewellery, a demand made by Bharatiya Janata Party's ally Shiv Sena and also the Congress.

Jaitley took a dig at the Congress: "I have not been able to understand the politics of hatred for 'suit' but (its) 'love for gold'."

"If the Congress had objections to the levy, it can begin by removing the five percent Value Added Tax in Kerala where it rules," he said.

Despite global recession, the Indian economy is doing well, he said and maintained that it can do much better in the event of a good monsoon.

"In comparison to the rest of the world, we are far ahead," Jaitley said.

Despite challenges, he said India still continues to maintain a high growth rate at 7.65 percent in 2015-16 compared with 7.2 percent in 2014-15.

The minister said the government will act tough against those found holding illegal offshore accounts as revealed in the Panama Papers leak.

Regarding the demands from members from Andhra Pradesh, especially Telugu Desam Party (TDP), a constituent of the National Democratic Alliance (NDA), Jaitley assured that a state which has lost a lot of revenue after its division and formation of Telangana will be given all the money it is entitled to.