A committee headed by Bharatiya Janata Party General Secretary Rajnath Singh to study the Kelkar Committee report will informally take up the composition of the committees that assisted the Kelkar panel in preparing reports on tax reforms.
The committee will submit its report to BJP president M Venkaiah Naidu on Saturday, two days before the party's national executive meeting at New Delhi.
Sources in the committee said one of the committees comprised members owing allegiance to a corporate house.
"This is not done. The usual practice is that a committee does not have members representing the same industry," committee sources said.
There was a conflict of interests if two members owed allegiance to one corporate house, they added.
The issue will not taken up formally as it will reflect badly on Finance Minister Jaswant Singh. "However, Singh may not even be aware of this," sources said.
Apparently, the issue will not form part of the committee's recommendations, which will largely confine itself to issues related to the contentious part of the report.
A section of the Rajnath Singh Committee feels that the Kelkar recommendation on waiver of tax holidays will curb entreprenureship and help established industrial houses.
Similarly, committee members expressed their opposition to the recommendation, which views infrastructure development as a "burden" that the private sector should not be saddled with.
"This is a negative way of looking at infrastructure development. Everyone has a responsibility. ...This is detrimental to development," they said.
Committee members said they would strongly oppose recommendations, which could have an adverse political fallout like imposing a tax on agriculture income.
"With barely two years left for the elections, we know that certain recommendations, if accepted, will spell political ruination for the party," they said.
Given Rajnath Singh's own pro-farmer leanings, it appears certain that Kelkar's report on tax reform will draw more flak from the Bharatiya Janata Party.
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