Was it necessary to tinker with the direct taxes in the Union Budget 2007-08? No, considering a new Income-Tax Act is to be introduced.
According to Mr T.S. Krishna Murthy, former Chief Election Commissioner and former official with the Union Finance Ministry, this move will neither boost tax collections nor will it simplify tax administration.
Addressing the members of the Southern India Chamber of Commerce and Industryat a post-Budget analysis session, he said more taxation would only cause administration problems. "Let us rationalise the tax structure first and then address income-tax issues," he said.
He also said budget allocations in the past had not been properly used. Despite pumping money into infrastructure and roadways for the last 50 years, Indian towns still have bad roads. "Making statements on the floor of the House will not implement anything," he said.
Mr Krishna Murthy added that growth driven by foreign investment would come if the Government chose to dedicate 60-70 per cent of non-plan expenditure towards infrastructure, education etc.
Mr M.R. Venkatesh of GSV Associates said this budget had "completely outsourced" all growth responsibilities, including development in agriculture.