3:54 pm
Jack
Home Minister P. Chidambaram, who as Finance Minister
had slashed taxes, on Wednesday suggested that rich should be taxed more
even though “many people” would not like the idea.
“We
must raise the tax revenue to defend (the expected aggregate decline of
resources). I know many people won’t like this. But I think, I can
summon the courage to make the statement,” he said addressing a function
of All India Management Association here.
Mr.
Chidambaram as the Finance Minister between May 2004 and November 2008
had slashed taxes and was credited with presenting a ‘dream budget’ in
the initial years of his tenure in the Finance Ministry.
“I
am (was) the Finance Minister who slashed your tax rates. Therefore ...
you must be prepared to pay higher tax rates, especially the rich must
be prepared to pay higher tax,” he said.
The Home Minister said, in Europe rich people were getting together to say, “please tax us more”.
His
suggestion is also in line with the move by U.S. President Barack Obama
who has proposed to tax rich for taking the American economy out of the
financial troubles.
“Certainly this is not the
place, nor I am the person to say what tax should be raised. But we
should seriously consider how to raise the tax revenue of the country,”
Mr. Chidambaram said, even as preparations for the next Budget (2012-13)
have started.
Mr. Chidambaram said that according to
the Approach Paper (12th Plan), tax revenue is expected to rise from
7.4 per cent in the current year to 8.9 per cent next year and the
non-tax revenue is expected to decline.
But, he said,
“the worrying part” is aggregate resources, that include tax revune,
non-tax revenue, non-debt capital revenue and borrowings, are expected
to decline from 14 per cent in the current year (2011-12) to 13.11 per
cent as a percentage of GDP.
The Home Minister said
while the actual difference would be marginal because of larger Gross
Domestic Product, as a percentage of GDP, aggregate resources would
decline.
