A budget, obviously, is not a magic wand to deal with all the problems of this country's . But it certainly is an instrument which can try to bring some equity into our system through judicious use of taxes and allocation. Looking from this angle, the class bias of Mr Pranab Mukherjee is clearly visible in this Budget.
SUBSIDY CUT
For example, take a look at the revenue mobilisation, a very critical area. . At a time of inflation, subsidies on fuel and fertilisers have been cut, knowing fully that this will have a cascading effect on inflation.
The cut in fuel subsidies is as much as Rs 25,000 crore. On the other hand, there is a huge amount of Rs 51,000 crore as tax concessions to corporates. The revenue from indirect taxes has been going up in recent years, while the revenue share of direct taxes decreased.
There is a reduction of Rs 4,500 crore in the direct taxes being levied from the rich. Through the increase in service and excise duties, the Government is expected to gain Rs 45,940 crore. I welcome taxes on luxury items, but strongly oppose the trend of depending on indirect taxes for revenue mobiliszation.
TOO LITTLE
The Government's subsidy bill on food, petroleum and fertilisers is estimated at Rs 1,79,554 crore for the 2012-13 fiscal, as against Rs 2,08,503 crore in the revised estimates for this fiscal. The questions of universalisation of health coverage, education and social security will remain unanswered. The Government's claims of added allocations do not make any impact in reality. The ministries of UPA government actually spend much less than what have been allocated. In the last year in most Ministries there has been a shameful shortfall in actual expenditures.
Lastly, the programmes like MNREGA have seen a huge shortfall of over Rs.9000 crores in the last year. The rural development ministry will receive Rs.1000 crore rupees less this year. A large section of the country is depending on such measures.
Given the distress in agrarian sector, such actions will increase migration. The government should now start thinking beyond the old agendas of disinvestment, banking-insurance reforms and cutting down key subsidies.
(The author is Polit Bureau member, CPM. As told to A. M. Jigeesh.)