A member of the Reserve Bank of India’s Monetary Policy Committee (MPC), Ashima Goyal, has suggested the imposition of income tax on affluent farmers as part of her wishlist for the upcoming Interim Budget 2024. Goyal emphasised the need for fairness in the taxation structure and proposed this measure to complement the existing government transfer payments to farmers.
Goyal expressed her views during a presentation of her wishlist, where she highlighted the unique nature of government transfer payments to farmers, likening them to a “negative income tax.”
In her proposal, she advocated for the introduction of a positive income tax on wealthy farmers, aligning with the government’s broader objective of transitioning to a data-rich system characterised by lower tax rates and minimal exemptions. The Interim Budget is scheduled to be presented in the Parliament on February 1, with expectations of no major changes to the taxation system.
Recent reports have hinted at potential enhancements to the PM-KISAN Yojana, with the government contemplating an increase in the annual transfer amount from Rs 6,000 to Rs 8,000 per farmer.
In the agricultural sector, the central government has encountered numerous concerns voiced by Indian farmers. Many farmers secure loans against their property, and in the event of any losses during a particular season, they find themselves without the means to repay these loans. The fundamental challenge we encounter is that, despite the government devising numerous schemes to aid farmers, there is a lack of an effective communication channel through which the government can reach out to them.
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