NEW DELHI: The Congress, in its manifesto released on Friday, promises major reforms in the tax system. It claims that the overall tax-to-GDP hasn’t increased in the last decade, leaving little room for increased expenditure.
It promises to enact a direct taxes code that will bring transparency, equity and impartial administration of taxes. The party said it would maintain stable personal income tax rates throughout its term for the benefit of salaried class and eliminate angel tax to boost investment in the new micros, small firms and innovative start-ups.
“The last 10 years of the BJP/NDA government is a case of ‘taxation gone berserk’. The share of taxes paid by the common person and the poor through regressive indirect taxes has increased significantly and the share of taxes paid by corporate has decreased – the exact opposite of what a people-friendly and progressive taxation policy should be.”
The party said it will replace the GST laws enacted by the government with GST 2.0 to reduce the burden on the poor. It will end “duplicitous “cess” raj of Modi government” to deny states their rightful share of tax revenues by introducing a law to limit Union cess and surcharges to 5% of gross tax revenues. It said GST will not be levied on agricultural inputs and the GST Council will be re-designed.
“The administration of GST laws will be divided horizontally between the central government and the state governments. Small GST-payers below a threshold will come under the purview of the state governments. A portion of GST revenues will be allocated to panchayats and municipalities.
Congress stated the shopkeepers and small retail businesses will be given major tax relief. The Income Tax Appellate Tribunal (ITAT), the Goods and Services Tax Appellate Tribunal (GSTAT) and the Customs Appellate Tribunal (CESTAT) will be autonomous judicial bodies without interference by the government.