Budget 2024: RBI MPC member suggests govt can look at taxing rich farmers

livemint.com:

Interim Budget presentation in Lok Sabha on February 1, the Reserve Bank of India's Monetary Policy Committee (MPC) member Ashima Goyal on Wednesday suggested that the government can contemplate imposing income tax on rich farmers to bring about fairness in the country's taxation structure, news agency PTI reported. "Government transfer payments to farmers are like a negative income tax. Along with that, a positive income tax can be applied for rich farmers as part of a movement to a data-rich system with low tax rates and minimum exemptions," PTI quoted Goyal as saying.

It is important to note that the Union government, through the PM-Kisan Samman Nidhi, provides ₹6,000 annually to poor farmers. The MPC member was responding to a query on whether the income from agriculture should be taxed in India. When Goyal, an eminent economist, was asked which government—a coalition government or single-party--produced better growth rates in the country, she replied that the economic growth rate of a country depends on several things, but during judging a government it is also necessary to see what growth rate they inherited and what they left the country with.

"Coalition governments have to work towards creating a consensus, which is a good thing. "But they tend to favour policies that deliver short-run rewards for their constituents, which hurt growth in the long run," she added. The MPC member noted that a single-party government can carry out measures that enable sustainable long-run growth.