RS passes corporate funding bill

The business companies that donated black money to political parties and their election campaigns in the country now have a chance to make a...

The business companies that donated black money to political parties and their election campaigns in the country now have a chance to make a perfect legal business of it.

Parliament today approved a bill that seeks to legalise funding of political parties by corporates and in turn they will be able to claim tax exemption from it.

Law Minister Arun Jaitely said in the Rajya Sabha during the passage of the bill — the Election and other related laws (Amendment) Bill 2003 — is a ‘‘humble beginning to legitimise the political fundings.’’

This legislation would enable amending the Representation of the People Act, Income Tax Act and the Companies Act for the purpose. Jaitely said the Government is in the process of making more laws for electoral reforms. The proposed laws would deal with problem of political defections and also for limiting the size of the Cabinet.

Introducing the bill in the Rajya Sabha (Lok Sabha has already passed it) Jaitely said the move is aimed at ending the hypocrisy behind the funding of the elections by the corporate companies. ‘‘It is a reality that political parties need people’s goodwill but it’s also a harsh reality that to sustain themselves, parties need money and they have been getting money from the corporate houses.’’

The main aim of the bill, he said, was to bring corporate funding and political parties under the taxation regime. Jaitley said this bill in no way legalises corporate donations or corruption in the political system but is meant to infuse accountability in the entire process. Also it has provisions for giving political parties slots on television for electioneering purposes.

Jaitely said the Election Commission is already looking into evolving a formula for giving slots to political parties on private television networks to minimise their financial burdens.

Story continues below this ad

Initiating the discussion, Congress member Pranab Mukherjee, who heads the Parliamentary Standing Committee on Home Affairs that went through the bill, said it is only a beginning to cleanse the political funding process.

He demanded auditing of accounts of political parties besides continuing the system of allotting reserved symbol to only recognised political parties at national and state level.

Majority of the speakers approve of the bill. However, some speakers demanded a comprehensive bill on electoral reforms is a need of the hour and the Government should not do it in a piece meal manner.