The Opposition on Friday hit out at the government after it slashed corporate taxes in a bid to revive the flagging growth.
The Congress called it yet another “panic reaction” to tide over “choppy sensex index” and asked why the government has left out the common man and not given a “single penny of relief” to honest taxpayers. The CPM described the deep cut as “brazen attempt to woo portfolio investors from the US and the rest of the world” on the eve of Prime Minister Narendra Modi’s visit to the US.
The government, however, said the move will attract investment.
“The step to cut corporate tax is historic. It will give a great stimulus to #MakeInIndia, attract private investment from across the globe, improve competitiveness of our private sector, create more jobs and result in a win-win for 130 crore Indians,” tweeted Prime Minister Narendra Modi.
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“Modi government is committed to making India a big manufacturing hub and this decision along with previous announcements on relaxing FDI will go a long way in realising this objective…Rationalisation of corporate tax had been a long pending demand…This move will make our corporates globally competitive and our markets much more exciting for potential investors,” Shah tweeted.
Hitting out at the government, former Congress president Rahul Gandhi tweeted, “Amazing what PM is ready to do for a stock market bump during his HowdyIndianEconomy jamboree. At + 1.4 Lakh Crore Rs. the Houston event is the world’s most expensive event, ever! But, no event can hide the reality of the economic mess “HowdyModi” has driven India into.”
Senior Congress leader Jairam Ramesh welcomed the cut, but expressed doubts on whether the step will revive investment. “A headline-it is afflicted, panic-stricken Modi Sarkar has cut corporate tax rates less than 3 months after a Budget and 4 months before the next one. This is welcome but it is doubtful whether investment will revive…” he tweeted.
Arguing that Finance Minister Nirmala Sitharaman is “running confused in circles”, Congress leader Anand Sharma said the move will not help induce private investments as companies are already deleveraging.
Party’s communication department head Randeep Surjewala said “Modi Government 2.0 has turned out to be an economic…disaster ”.
Arguing that slashing corporate tax worth Rs 1.45 lakh crore a year is “yet another panic reaction”, he asked the government to disclose “where will the resources to compensate the revenue loss come from?”
“Will they come by taxing the common man and the farmer in shape of taxes on petrol, diesel, electricity…?,” Surjewala asked.
The CPM said in a statement, “What is needed is large doses of public investment to create employment and increase people’s purchasing power (but) the government is pursuing the exact opposite which is…loot of Indian money for private corporate benefit and speculative profit.”