Harsh measures in Budget were inevitable: Shettigar

Harsh measures taken in the Budget on Income Tax, security surcharge, LPG price hike and lowering of interest rate, were 'inevitable' in view of the economic and political challenges confronting the country, member of Prime Minister's Economic Advisory Council Jagdish Shettigar said in Kolkata on Tuesday.

"The harsh measures proposed in the Budget were inevitable. This was due to the slowdown of the economy and army deployment on borders," he said.

The tax measures and security surcharge were proposed in the Budget to deal with the shortage in revenue collection and meet additional expenditure of the government on Army deployment on borders, he said.

Speaking at an interactive session on the Budget at the Indian Chamber of Commerce, he said the revenue shortfall has worsened the fiscal position and the government now needs to borrow Rs 180 billion even to meet debt servicing charges.

The Army deployment, on the other hand, has already cost the government Rs 35 billion, more than the Rs 30 billion proposed to be generated through imposition of surcharge.

Speaking at the occasion, Communist Party (Marxist) Politburo member Sitaram Yechuri said the Budget has actually "worsened" the economic situation.

On the defence surcharge, he said, there was no need for additional tax as an amount of Rs 50 billion remained unspent from last year's allocation for defence.

PTI

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