Cut corporate tax breaks: Left to Govt

New Delhi: The country's two major Left parties have asked the UPA Government to allocate sufficient funds in the 11th Five Year Plan to fulfill promises in the Common Minimum Programme like hiking public spend on agriculture, education and healthcare.

"In order to do justice to those commitments, Plan expenditure has to be increased substantially", CPI(M) General Secretary Prakash Karat and his CPI counterpart A B Bardhan said in a letter to Prime Minister Manmohan Singh.

The two top Left leaders pointed out that the Planning Commission had proposed an increase in gross budgetary support for the 11th Plan only by about 2.5 per cent of GDP.

The CMP has promised spending 6 per cent of GDP on education and 2-3 per cent on healthcare.

"This implies that either the CMP mandated schemes would be under-funded or Plan expenditure on other items would be cut in order to fulfill the CMP commitments, which is unwarranted," they said in the letter.

They said there does not seem to be any lack of domestic resources in order to enhance Plan expenditure to meet these commitments.

Karat and Bardhan said as per a recent official note, the total tax exemptions or concessions granted in 2004-05 was a whopping Rs 176,073 crore or 5.8 per cent of GDP. Of this, corporate tax exemptions alone amounted to Rs 57,852 crore or 1.9 per cent.

"Curbing such tax exemptions along with the implementation of other proposals for resource mobilisation made by the Left parties would help in financing of enhanced Plan expenditure", they said.

Karat and Bardhan pointed out that the Left parties, while assessing the performance of the UPA government that they support from outside, had expressed "dissatisfaction over the lack of adequate fund allocation to fulfill the commitments made in the CMP vis-a-vis people's welfare".

Apart from spending on agriculture, education and healthcare, the Left has also sought implementation of CMP promises regarding ensuring social security for unorganised sector workers and universalisation of integrated child development scheme.

Besides, it has sought provision of a guarantee for at least 100 days of employment for one able-bodied person in every rural, urban poor and lower middle-class household and strengthening the public distribution system.

"Besides enacting the National Rural Employment Guarantee Act and initiating it in 200 districts, no major initiative has been taken by the government in these areas even after completing half of its tenure", they said.

The Left leaders pointed out that the plight of deprived sections, including Dalits, adivasis and even Muslims, was "most deplorable" and demanded special allocations to address their problems.

They said the gross budgetary support should be increased by at least one per cent of GDP from the very first year of the 11th Plan (2007-08) and increased by a similar amount in the subsequent years.

"Fulfilling the commitments made in the CMP should be accorded top most priority while deciding upon the gross budgetary support for the 11th Plan", Karat and Bardhan said.