The BJP is likely to drop its plan to promise abolishing of income tax, a move seen as a way to win urban and middle-class votes in the general elections.
The party is all set to drop the proposal from its economic resolution which will be presented in its two-day national council meeting to be held from January 18. The economic resolution would be a preliminary concept note for the party’s election manifesto and a vision document prepared before the Lok Sabha polls.
A senior BJP leader said that the resolution would talk about simplification and rationalisation of tax, but may not include the abolition of income tax. “The economic resolution to be presented in the last national council meeting before the parliamentary elections would contain the simplification and rationalisation of tax, inflation; corruption, absence of leadership and lack of vision in the current government and the prevailing economic condition in the country,” he said.
The leader said that the proposed changes could blur the distinction between the rich and the poor. “The poor would end up paying the same amount of tax as the rich; this would include farmers, who are currently exempted from paying tax on agricultural income,” he said.
Former BJP president and head of the committee preparing the party’s vision document, Nitin Gadkari, had hinted that the party may include a proposal to abolish income, sales and excise taxes in its vision document. He suggested that a bank transaction tax could easily compensate the losses incurred from the scrapping of the income tax.
Recently, yoga guru Baba Ramdev had demanded abolition of all taxes and the introduction of a banking transaction tax. On January 5, at a function organised by Ramdev in Delhi, BJP’s prime ministerial candidate Narendra Modi highlighted the need for radical reforms in the existing taxation structure to ease the common man’s burden.
The party feels it had not changed its stand after Modi’s promise to Ramdev. “He (Modi) promised reforms in the existing tax structure and party incorporating it in its economic resolution. Modi ji never said that the BJP would abolish income tax, so there should be no confusion on the issue,” said a BJP leader.
The BJP’s national executive will be held on January 17 while the national council meetings will be held on January 18-19, with the target of ‘mission good governance’.