New Income Tax Act should be simple and practical
It refers to setting up of a panel for drafting new Income Tax Act to replace the earlier one legislated way back in the year 1961. Earlier half-century old Act had lots of patch-works in form of amendments. New Income Tax Act should be drafted carefully on the basis of past experiences so that amendments may not be usually needed. It should be simple and practical rather than complicated and cumbersome Goods and Service Tax (GST) finding so many problems and changes in just four months of implementation.
Special Investigating Team (SIT) set up by Supreme Court on aspect of black money in its third report pointed out towards irregularities detected in me of 'dotions', 'charity' and other such contributions. Already several Non-Government-Organizations (NGOs) have been under the scanner for converting black money and hawala-operations. Schools are charging heavy amounts for admission in me of 'dotions'. Charitable trusts are formed with tax-exemption certificates for whitening black money. There is heavy loss to exchequer because of double-edged tax-exemption to political parties which are not complying with full-bench CIC-verdict for being accountable to public through RTI Act.
Best is to abolish altogether provisions under various sections of Income Tax Act for any type of contribution made. It will effectively check all tactics to whiten black money. Otherwise also huge revenue so earned will be available for public welfare and tiol development which in no way is less important than contributions, dotions, charity and other aspects presently wrongly exempted under Income Tax Act.
The 'bail-in' clause: Deposits are at risk
The Fincial resolution and deposit Insurance (FRDI) Bill, 2017 introduces the provision for a bail-in, whose purpose is to provide capital to absorb the losses of a bank and ensure its survival. Here, survival does not mean safety of depositors' money, but restoration of capital of the bank. The bail-in clause changes the ture of relationship between the customer and the bank. It would mean that money is no longer safe in a bank. An account would lose its sovereign guarantee and instead become and investment.
The bail-in clause of the FRDI Bill, 2017, can be disastrous as it could foster feelings of insecurity about one's money in the bank. The agenda of fincial inclusion must and suffer from such ill-perceived schemes. Non-performing asset-ridden public sector banks must be bailed out by the Insolvency and Bankruptcy Board of India, the Public Asset Rehabilitation Agency Scheme for sustaible Structuring of stressed Assets, Strategic Debt Restructuring and Mission Indradhanush, thereby tackling bad debts while keeping customer confidence infect. This becomes more essential as savings growth is pertinent in boosting the investment climate of the tion.
Satish Kumar Sarma,
Kalyanpur, Biswath Chariali.