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50 Years ago (4 March 2006)

the rate of growth of the economy, but no undistributed profits is withdrawn. Fourthly, FROM 50 YEARS AGO change in the social and economic institu-a graduated super-tax will be levied on the tions to which each of us is in his own way dividends in excess of 6 per cent of paid-up attached. We desire greater social justice, but capital declared by Indian Companies. Fifthly, not through intensive taxation since it results, bonus issues are to be subject to a tax of two so the argument goes, in levelling down rather annas; and finally, the penal super-tax pay- Vol VIII, No 9, March 3, 1956 than levelling up. Many such contraries could able by a Section 23-A company dealing be listed; but for the time being, we have wholly or mainly in investments is raised from before us Shri Chintaman

FROM 50 YEARS AGO the rate of growth of the economy, but no undistributed profits is withdrawn. Fourthly, change in the social and economic institu-a graduated super-tax will be levied on the tions to which each of us is in his own way dividends in excess of 6 per cent of paid-up attached. We desire greater social justice, but capital declared by Indian Companies. Fifthly, not through intensive taxation since it results, bonus issues are to be subject to a tax of two so the argument goes, in levelling down rather annas; and finally, the penal super-tax pay-

Vol VIII, No 9, March 3, 1956 than levelling up. Many such contraries could able by a Section 23-A company dealing be listed; but for the time being, we have wholly or mainly in investments is raised from before us Shri Chintaman’s latest proposals four annas in the rupee to eight annas in the

Deshmukh and Direct

and it is about the grouses and grumbles rupee on undistributed profits.Taxes occasioned by them that we are concerned… These proposals are, so to speak the prin(Editorial) What in effect, does Shri Deshmukh pro-cipal bones of contention. They are disap

pose? Firstly, the super-tax on incomes above proved of because they touch two important

Shri Chintaman Deshmukh’s sixth budget Rs 70,000 is to be slightly raised, so that the sources of funds for the private sector, viz, has, as usual, been criticised both for what tax on incomes above Rs 1,50,000 will be the savings of persons in the highest income it proposes and for what it does not... in terms 91.9% instead of 88.6% as at present. Sec-ranges and the retained profits of business of logic, he could hold out that he has done ondly, registered (partnership) firms will be enterprises... It is doubtless good strategy not nothing more than translating the objectives of subjected to a graduated tax, amounting to to yield anything unless one is forced to; but the Second Plan into fiscal measures, neces-a maximum of one anna six pies in the rupee in the present social climate there are also sary or feasible in the first year of that Plan. on incomes over Rs 1,50,000 incomes up to other things to be considered – as, for in-

The fact is, all of us want certain things Rs 40,000 being exempt from the levy. Thirdly, stance, a willingness to see the development without having to risk or sacrifice certainother in respect of non-section 23-A companies, efforts in the public sector as necessaryand things. We want, basically, an acceleration of the rebate of one anna in income-tax on complementary to those in the private sector.

Economic and Political Weekly March 4, 2006

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