Finance Bill debate: Didn’t impose new taxes, focused on Capex for economic recovery, says FM

Replying to the debate on the Finance Bill, which the House passed, Sitharaman said that India, instead, put the money where there would be multiplier effect and aid the post-pandemic economic recovery.

“According to an OECD report, 32 countries have increased the tax rates after the pandemic. Instead, we put more money where multiplier effect would be maximum,” she said, while referring to the Budget’s focus this year on raising capital expenditure.

The Finance Bill gives effect to new taxation, thus completing the budgetary exercise for the 2022-23 fiscal.

The Finance Bill was approved by the Lok Sabha after accepting by voice vote the 39 official amendments moved by Finance Minister Nirmala Sitharaman and rejecting the amendments proposed by the Opposition.

The Budget 2022-23 raised captial expenditure (Capex) by 35.4 per cent to Rs 7.5-lakh crore to continue the public investment-led recovery of the pandemic-battered economy.

Observing that the Modi government believes in lowering taxes, Sitharaman said the reduction in corporate tax has “helped the economy, government and companies, and we are seeing the progress”. She said Rs 7.3-lakh crore has been collected as corporate tax so far this fiscal.

The number of taxpayers has increased to 9.1 crore from 5 crore a few years back, she said, adding the government is taking steps to widen the tax base and the faceless assessment has been received well by people.

Responding to the concerns expressed by members on imposing customs duty on umbrella, she said it was done to encourage domestic manufacturing by MSMEs.

Earlier, while participating in the debate on the Bill, Opposition members raised several issues, including unregulated virtual digital assets such as cryptocurrency.

Congress MP Gaurav Gogoi, while initiating the debate from the Opposition side, said the government should come out with a legislation soon to prevent their misuse for purposes such as terror financing and drug smuggling.

“The government is still sending mixed signals on virtual digital assets. There should be clarity on the definition of crypto,” Gogoi said.

Gogoi further said that the government should take a view on this so that virtual digital assets do not become a preferred route for money laundering, drug smuggling or crime. “I expect the policy to come out sooner than later…crypto is a risk at the moment,” he said.

Observing that every government wants to widen the tax base, he said high net-worth individuals (HNIs) are the biggest contributor to revenue mobilisation. There has been an exodus of 7,000 HNIs from India since 2019, he said. He wondered what ecosystem the country is offering to the wealth creators.

On fuel price hike, Gogoi said it has been increased for the third time in one week and added the government should maintain status quo to provide relief to common people who have just come out from the third wave of Covid-19.

“They need a chance to conduct their businesses in a free-and-fair atmosphere, not always under the burden of high inflation and high fuel prices. And it is a bit ironic as to the answer that the government or its spokespersons are giving on fuel prices, they are saying that the fuel prices are bound to happen (increase) because of the conflict in Ukraine,” he said.

The Ukraine conflict did not begin last week, he said, adding it has been going on since December and Russian troops were on border for more than a month.

“For one month, they could keep the prices stable. What has changed now? Just because (five state Assembly) elections are over…that’s how you repay the people who put you back to power,” he said.

Supriya Sule of the NCP demanded a ban on crypto, saying various committees have suggested so. She also questioned the imposition of 30 per cent tax on capital gain out of virtual digital assets even when there is no legislation on that.

Aparupa Poddar of the TMC said the government talks about increasing the GDP, “which means gas, diesel and petrol (prices)”. She also sought to know the quantum of black money identified because of demonetisation.