Only Indira Gandhi’s 1970-71 budget which raised marginal taxes to 97per cent comes close to yesterday’s effort
He came, and he did not conquer. Worse, this budget is likely to turn on the master. I do not recall any budget in the last 20-odd years when there was so much consensus on expectations. Briefly, the near-universal expectation was that the finance minister, Pranab Mukherjee, would do all of the following: First, that this would not just be a vote-on-account budget, that it would be substantially more in the sense of containing some vision, some direction. The big picture, if you will. He was presenting his third budget in a row. Each of his budgets has been worse than the last, which is why even the RBI, an institution under the direction and “control” of the finance ministry itself, was waiting to see what the FM had in mind in terms of fiscal consolidation. Did Mukherjee succeed in delivering any vision? Not if you consider that all his policy recommendations had more to do with tinkering than with any sense of vision, let alone vision per se. So score zero on vision.
The move comes following the Supreme Court’s decision in January that the Vodafone-Hutchison deal is not taxable in India. The government has already filed a review petition before the Supreme Court.
“I had to move this amendment at the earliest available opportunity...,” said Mukherjee in response to a question on why he did not wait for the Supreme Court’s response to the review petition. “Had I done it after the Court’s order, everybody would have criticised me again,” he said.
The amendment is being moved retrospectively from 1961 only to make the legislature’s intent clear that tax is liable in all such cases from the date of enactment of the IT Act.
Quote from Mr. K Subramanya, CEO, TATA BP SOLAR – “We at Tata BP Solar are quite disappointed with the budget from solar perspective. The budget is pro imports and anti-domestic, not a great boost to the solar manufacturing sector. As a result of this, solar manufacturing investments in India will go take a backseat, and might even lead to loss of jobs for people in the industry. This also makes further investments in manufacturing almost impossible. It seems that the government has not heard the woes of the industry, or addressed them. We wish that the government takes note of this and takes immediate action to rectify the situation.”