Chandigarh: BJP MP Subramanian Swamy on Saturday batted for abolishing income tax, hiking interest rate on fixed deposits and lowering it on loans to spur economic growth.
“The main thing is that the income tax should be abolished. The rate on fixed deposits should be increased to 9% and the rate of interest on borrowings should be brought down to 9% as well. If these three steps are taken, things will improve,” said Swamy, talking to reporters here.
Swamy said he is also coming up next month with a book, suggesting steps to spur economic growth. “A lot needs to be done for the economy. My book is coming out on 5 September, in which I have explained what needs to be done,” he added.
Swamy made the remarks when asked if the steps taken by Finance Minister Nirmala Sitharaman would revive the growth.
In a bid to boost economy on a five-year low, the Centre on Friday announced a slew of measures, including the rollback of surcharge on foreign and domestic equity investors, a promise to review the super rich tax on high networth individuals, exempting startups from ‘angel tax’, a package to address distress in the auto sector and upfront infusion of Rs 70,000 crore to public sector banks.
To bolster consumption, the government has also persuaded banks to cut interest rates, a move that would lead to lower EMIs for home, auto and other loans.
Many middle class citizens who voted for a Narendra Modi-led government in 2014 had expected an end to the income tax regime five years ago. However, this was not a promise made by the BJP. Baba Ramdev-led Bharat Swabhman had raised the demand, seeking to replace income tax with transaction tax. Appearing for an interview around that time, Swamy had said it was quite possible that income tax would be abolished but it was not yet decided whether transaction tax would replace it.
The salaried section of the Indian population complains that income tax is an unfair regime as the business class has ways to underreport their incomes to save on taxes whereas the salaried people are subjected to tax deductions at source. They call it unfair also because the percentage of Indians who pay income tax is minuscule. Thus, they feel, a small section of Indians are made to discharge social responsibility towards 100% Indians.