Capital gains for CPM
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- Published 6.04.09
New Delhi, April 5: The CPM’s fortunes seem to have kept pace with the rise in its political graph that touched an all-time high in the 2004 elections.
Its net worth on March 31, 2006, was Rs 77.27 crore — not too bad a capital for a communist party — according to details of the CPM’s income tax returns for certain years accessed by The Telegraph.
The documents show the assets more than doubled in the four years since March 31, 2002 (see chart). The months that followed the 2004 polls saw a surge in generosity among the party’s well-wishers.
Donations jumped nearly 40 per cent in the year after the polls — from Rs 12.89 crore in 2004-05 to Rs 17.89 crore in 2005-06. In 2001-02, the donations were just Rs 8.69 crore. Overall, the party received Rs 62 crore in donations between 2001-02 and 2005-06.
The other principal source of the CPM’s income — the “levy” each member must pay the party every month, quarter or year depending on his pattern of earning — nearly tripled from Rs 6.17 crore in 2001-02 to Rs 16.77 crore in 2005-06. In the one year between March 31, 2005, and March 31, 2006, its levy collection rose by over 30 per cent.
Since the party membership has not risen dramatically — CPM records show a rise of 13 per cent between 2004 and 2007 — the increased collection could be the combined effect of two other factors.
One, a hike in the levy (although party sources would not reveal how much the levy had been increased). Two, a possible change in the class profile of a section of party members (since the levy represents a fixed percentage of a member’s income).
The CPM is very strict about levy collection: a member who delays payment by over three months is liable to be expelled under the party constitution. The party received Rs 53.18 crore in levies between 2001-02 and 2005-06.
Under expenditures, the CPM claims to have paid Rs 30 crore to party whole-timers in salaries and allowances between 2001-02 and 2005-06.
Although the party has shown good balance sheets over the years, it has not balked at taking bank loans. For instance, in 2003-04, it showed a bank balance of Rs 35.13 crore, and interest paid as Rs 1.13 lakh. It did not reveal the amount of loan taken.