Former MP and chairman of All India Congress Committee’s research department, M.V. Rajeev Gowda, on Monday alleged that the announcement of tax cut for the middle class in the recent Union Budget was a gimmick to divert the country’s declining growth rate.
Addressing presspersons here, Mr. Gowda said that despite raising the no-tax bracket to ₹12 lakh, the Budget failed to spur economic growth. He pointed out that the tax cut benefits only about three crore urban taxpayers.
“The Finance Minister and the Prime Minister have been claiming that the reduction in income tax will increase consumption. This income tax cut should have happened for the middle class many years ago. But it will benefit only three crore people. Even if the country’s population is 143 crore, what benefit will the remaining 140 crore people get? Nothing,” he said.
“Instead, if fuel prices were reduced, it would have benefited the entire country, including wage labourers, domestic workers, and all classes of people. If GST was reduced, it would have been even more beneficial. The important thing is that the savings rate of the people has fallen,” he said.
He alleged that the government’s economic strategy is skewed towards a select group of companies, leaving private sector investment lacking. “High-net-worth individuals are opting to invest overseas rather than in India,” he said.
Published – February 03, 2025 08:33 pm IST