Look where your own contribution towards national security has gone

If you felt proud paying that extra bit of income tax, now is perhaps time to feel sorry. Last year, the government levied a 5-per cent surc...

If you felt proud paying that extra bit of income tax, now is perhaps time to feel sorry. Last year, the government levied a 5-per cent surcharge and collected Rs 4,253 crore in the name of national security. But not even a single rupee was spent on what it was meant for — the money went into bridging the fiscal deficit due to drought relief.

The armed forces were ‘‘advised’’ to surrender Rs 9,000 crore — which included Rs 6,499 crore earmarked for buying weapons to build Indian military capability — by the Finance Ministry.

But that does not stop the ministry from squeezing you again in the name of national interest. This year too, the ministry has levied a surcharge of 10 per cent on tax-payers earning more than Rs 8.5 lakh per year. Government estimates say Rs 2,800 crore will be collected. But where will the money go?

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India’s conventional parity with Pakistan has narrowed, terrorism is yet to scale down but the defence expenditure recorded an all-time low of 13.86 per cent of the total government expenditure during the last fiscal.

For the past three years, the Defence Ministry has ‘‘surrendered’’ Rs 4,126 crore, Rs 5,000 crore and Rs 9,000 crore respectively despite the 1999 Kargil war.

Defence Ministry officials say that in 2000 and 2001, part of the defence outlay was unutilised as the political leadership could not take a decision on advanced jet trainer, Admiral Gorshkov aircraft carrier and PHALCON airborne early warning aircraft deals. However, last fiscal, the ministry was advised as early as December, 2002 to rein in expenditure.

Then, the Finance Ministry wrote to the Defence Ministry in January, saying that as huge expenditure had been incurred on providing relief to the drought-hit states, the unspent outlay should be ‘‘surrendered’’.

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Unlike the cess on petrol and diesel that goes into the National Highways Fund, the national security surcharge does not make it towards building the military capability as it is not an earmarked fund.

Instead, it goes to the consolidated fund.

Madan Lal Khurana, chairman of the Standing Committee on Defence, suggested to the Finance Ministry that the surcharge collected in the name of national security should be put in a ‘‘non-lapsable fund’’ for the armed forces in case the military cannot utilise the outlay.

This was something that the Defence Ministry has been suggesting for the past two years. But the Finance Ministry says it is against the budgetary system.

Khurana says: ‘‘I am of the opinion that Rs 9,000 crore, surrendered this fiscal, should be put in to the non-lapsable fund as it was collected from the tax-payer in the name of national security.’’ If it is not, then should it not be given back to the tax-payer? Even Khurana is silent.