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BJP attacks Kelkar panel's tax proposals

The Kelkar Committee report on direct and indirect taxes came under attack at the BJP National Executive, which favoured retaining tax benefits for the middle-class, farmers and the small-scale industries, with an eye on the assembly elections in ten states.

"Members wanted tax benefits for the middle class, farmers, senior citizens and small-scale industries," party sources said in New Delhi on Monday at the end of the first day's meeting.

The members felt that Kelkar Task Force recommendations were "tilted towards the corporate sector and big business houses and had no benefit for the middle and working classes, senior citizens and women taxpayers," sources said.

There was strong opposition to Kelkar panel's suggestions to do away with tax exemption on housing loans as it felt that this would affect the construction industry, which has been doing well despite the economic downturn, they said.

They said the seven-member Rajnath Singh Committee set up by the party to study the Kelkar panel's recommendations had received about 2000 suggestions. The discussion on it is likely to continue on Tuesday.

"It is a major issue as the matter concerns a large section of the population and the party will therefore discuss it in detail before making suggestions to the finance minister for inclusion in the 2003-2004 General Budget," sources said.

The recommendations submitted to the finance minister on November 2 in the form of a discussion paper has recommended that tax exemption be reduced to Rs 100,000 in 2003-2004 from the present Rs 150,000 and to Rs 50,000 in 2004-2005 and nil in the following year.

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