1. Letters to the editor

Letters to the editor

Students from economically weaker sections have to resort to borrowing from banks and private money lenders at high rates.

By: | Published: May 18, 2016 7:14 AM

Vexing tax issues

This refers to the editorial “Missing tax reforms” (FE, May 16). It has been pointed out that till October 2015, the number of pending appeals at the Commissioner (Appeals) level had shot up to over 2.81 lakh cases and the amount locked up in these cases had ballooned to R5.67 lakh crore. While R5.67 lakh crore may just be data for the government, it could be a cause of worries and nightmares for the concerned assesses. That many of these cases might be pending for quite some time, indicates that the Commissioners (Appeals) may be in a fix and probably don’t know as to which way they should take the call. In other words, there could be problems with the tax provisions as regards clarity and reasonableness. Apart from pushing the Commissioners (Appeal) for taking calls expeditiously, the Commissioners could be asked to simultaneously report to the revenue department the particulars of the disputes indicating the tax provisions covering the dispute, the assessee’s view point, the department’s stand and the commissioner’s call. This report should be used by the revenue department for identifying the contentious/ambiguous provisions in tax laws and rules. Then attempt should be made to eliminate ambiguity and also to make such provisions simpler and reasonable. After all the objective of tax provisions should be to collect revenue for sustenance of government and its programmes with equity and fairness and these provisions should not be allowed to become cause for killing or discouraging legitimate economic activity or for harassment of or extortion from tax assesses.

Nand Kishore, Delhi

Education loans

Apropos of the editorial “Repayment and the 3Rs” (FE, May 14), the highly profit-maximising educational institutions, particularly the private sector professional institutions, are luring students by making tall promises. Students from economically weaker sections have to resort to borrowing from banks and private money lenders at high rates. The surging bad assets in educational loans of banks points to the higher debt burden of the students vis-a-vis their ability to service the loan. Even if one gets a job, frequent defaults are occurring due to insufficient salary. The government must look for radical reforms in the education sector to provide low-cost professional courses and cap the exorbitant fees being charged by the private educational institutions. The rate of interest, the moratorium period and repayment schedule of education loans need to be relaxed further to prevent defaults and to maintain the loans as performing assets. While recruiting candidates, the employers must ask for the details of loans outstanding. This will significantly help banks in maintaining educational loans as performing assets. Tracking the borrower is absolutely necessary to ensure regular repayment, for which linking with Aadhaar will be useful. The government /regulator must look at revisiting the current education loan policy for comprehensive reforms to make it more bankable.

VSK Pillai, Kottayam

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