Interim budget may see some change in taxes: P Chidambaram
February, 04th 2014
The upcoming interim budget could have some goodies for the aam aadmi in theform of indirect tax cuts, but there won't be any income-tax relief soon for inflationscarred consumers. Finance minister P Chidambaram will present the vote-on-account on February 17. "We can make any proposal short of amending any law... We cannot propose amendments to the Income-tax Act, Customs Act or the Excise Act... We can also outline a vision for the future," Chidambaram said in response to a query on the vote on account at a news conference on Monday.
This could mean possible moves to ease curbs on gold and selective changes to provide an impetus to some sectors. ET reported last month that some sections of the Congress party's leadership wanted the finance minister to make a 'splash' with the vote on account before the general elections.
Chidambaram seemed to rule out any such design in the vote-on-account, though he has a near Rs 10,000-crore surplus to accommodate any last-minute spending. He said whatever changes are required to be made without an amendment to the law "are being made and will be made".
Indirect taxes include excise duty levied on goods at the factory gate, all import duties such as basic Customs duty, special additional duty, countervailing duty and service tax. The government can cut indirect tax rates without Parliament's approval through a notification. "We have made a couple of changes last week. We will continue to ake those changes until the term of this government (ends) if they do not require parliamentary legislation or sanction. We will have to notify the changes and place the notification in Parliament," he said.
Former finance minister Jaswant Singh unveiled indirect tax cuts just days before the vote on account in 2004. Pranab Mukherjee announced cuts in excise duty and service tax rates by two percentage points in his reply to the vote on account in 2009. "In 2004, Mr Jaswant Singh made a 12-page speech. In 2009, Mr Mukherjee made an 18-page speech. So, I have two numbers to choose from between 12 and 18," Chidmbaram said.