The Telegraph
Since 1st March, 1999
Email This Page
Pledge of 10000 'good news'

New Delhi, March 17: Finance minister P. Chidambaram today hinted at the possibility of backing off on the tax on cash withdrawals above Rs 10,000 from banks.

'I am sensitive to the concerns expressed by members. No tax has been imposed. It has only been proposed. You will dispose it of,' Chidambaram told the Lok Sabha while winding up a three-day discussion on the budget.

He said Prime Minister Manmohan Singh had asked him why there was uproar in the House when he had proposed the tax in the budget.

'I told the Prime Minister, 'Sir, I was applying your and my austere standards when I had made the proposal'.'

The finance minister has claimed that the tax was designed to establish a trail that would effectively control the generation of black money.

There have been reports that Chidambaram might raise the Rs 10,000 floor for levying the tax and exempt withdrawals from savings accounts.

'Someone referred to the savings account. You will get good news when we discuss the finance bill,' he said.

If the tax is imposed on current accounts alone, it will affect businesses more than salaried individuals who mostly have savings accounts.

Current accounts pay no interest but provide the facility of an overdraft and do not place limitations on the number of transactions that can be undertaken in a month.

Removal of the Rs 30,000 standard deduction is expected to adversely affect pensioners, a point that the BJP's Vijay Kumar Malhotra had raised.

'We are here to remove the wrinkles on the faces of senior citizens. Women and senior citizens are our constituency and not yours,' Chidambaram replied.

He sidestepped the other controversial proposal to levy a fringe benefit tax.

Email This Page