Missed Opportunity to raise resources to reduce fiscal deficit

Budget-2009-10

Finance Minister has lost a golden opportunity to raise resources to contain fiscal deficit and comply with the FRBM Act.

All the western countries who were responsible for the financial meltdown and declared stimulus package had taken steps to raise taxes from the wealthy and granted concessions to the needy to create demand so that economy could sustain.

In its latest budgets  both US & UK raised the income tax rates to 40 and 50% respectively for those who earn around $250000.The refrain of the government is for sharing the wealth with those who do not have.There is also proposal to increase capital gains and dividend taxes in the UK.Even capping of the executive pay is also in consideration for controlling the extravagant expenditure.There is no use in putting money in the hands of people who can afford to spend and extending concessions.

Finance Minister must not take the demands of the stock market seriously since it does not constitute the whole country and represents only minuscule minority propped up by the electronic media.

Private sector has failed to protect the public good throughout the world and the greed of private enterprises and their extravagant spending the entire financial system  of the world into turmoil. In these circumstances divesting the public sector to enhance the pockets of private corporates will do more harm to the taxpayer than doing good.

Even if divestment is necessary it should be used only for further expansion of public enterprises and not bridge the budget deficit.

Even the concession extended to the industry should be limited to SMEs only.Even persons like NR Narayan Murthy suggested not to extend concessions to the industry who are able to earn sufficient profits.

It is time that the industry from which many of them find place among the riches in the world must share and help the government by not demanding any concessions from the government

K.VITTAL SHETTY, B.A., CAIIB,DBM(IIB),MBM

FOUNDER

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