Raise I-T exemption limit to Rs 2 lakh & tax the rich to bridge deficit: trade unions

New Delhi, Dec 29 | Updated: Dec 30 2006, 05:30am hrs
Trade unions on Friday asked the government to increase income tax exemption limit to Rs 2 lakh and reiterated their demand to tax the rich to bridge the fiscal deficit.

In a pre-budget meeting finance minister P Chidambaram, the trade unions also sought exemption to perquisites given by employers from fringe benefit tax.

The trade unions also sought a ban on forward trading in commodities, rationalisation of taxes on petroleum products and strengthening the public distribution system to contain inflation and increased public investment in the social sector.

Budget should ensure allocation of at least 25% of the revenue for social sector covering education, health and housing, the trade unions memorandum to the finance minister says. They also reiterated their demand for legislation for unorganised sector.

According to sources, the President of INTUC, G Sanjeeva Reddy, asked the Chidambaram to increase the EPF interest rate immediately. Reddy also demanded the percentage of salary deducted for provident fund be increased to 15% from 12% at present.

The trade unions also asked the government to stop showering incentives and concessions to corporate houses, foreign companies, FDI and FII as well as SEZs.

The trade union recommendations also asked the government to scrap the National Investment Fund. We have asked the government to break with the past and present a people friendly budget. There should be massive increase in investments that could be mobilised from within the country itself, All India Trade Union Congress general secretary and MP Gurudas Dasgupta told reporters after the meeting.

The Prime Minister has been telling the states to curb fiscal profligacy but central government continues to give tax concessions to multinationals and big industrial houses, leading to revenue loss, Dasgupta added.