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India


Corporate tax cut resulted in revenue loss of Rs 1.84 lakh cr to exchequer: Congress

Corporate tax cut resulted in revenue loss of Rs 1.84 lakh cr to exchequer: Congress

New Delhi, Aug 16 (UNI) The Congress on Tuesday said the Modi government's move to cut corporate tax had led to a revenue loss of Rs 1.84 lakh crore to the exchequer.
Addressing a press conference here, Congress spokesperson Gaurav Vallabh posed a volley of questions to the ruling dispensation why the tax cut was limited to corporates.
"On September 20, 2019, the government announced a corporate tax cut from a base rate of 30 per cent to 22 per cent for existing firms without exemptions/incentives and from 18 per cent to 15 per cent for new manufacturing units. This announcement was made exactly two days before the ‘Howdy Modi’ event organised on September 22, 2019 in Houston, US.
"The rate cut came amid fiscal distress as in the same month Finance Minister had told states at Goa’s GST Council meeting that the Centre had no money and wouldn’t be paying the GST compensation any more," he said.
"Why is the corporate tax rate cut limited to corporates? Why it cannot be extended to the middle class and the lower income group?
"Why is the 'suit-boot ki sarkar' only limited to corporates ?"
"For the last three years, the government had repeatedly claimed that the corporate tax cut would help increase corporate tax collection. But the Parliamentary Committee on Estimates put out different claims in its report submitted on August 8.
"The panel said the corporate tax cut of 2019 had resulted in a negative 'revenue impact' of Rs 1.84
lakh crore," the spokesman said.
Giving a data of the reported loss incurred, the spokesperson said: "Financial Year 2020 revenue loss was Rs 87,835.75 crore and FY21 was Rs 96,399.74 crore."
"Tax cuts given to middle and lower-income groups increase consumption and, as a result, employment. Why is the same not explored? Why does 'suit-boot ki sarkar' hates the middle and lower-income class?'
The Congress spokesperson said: "Tax cuts for the rich lead to higher income inequality in both the short- and medium-term. In contrast, such reforms do not significantly affect economic growth or unemployment."
UNI DS MR SHK1710

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