The Congress Must Steer Clear Of Such Retrograde Ideas
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By Our Editorial Team
First publised on 2024-04-26 15:35:58
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The India Commentary view
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Sam Pitroda, the chairman of the Indian Overseas Congress, would not have had the courage to call for the reintroduction of the inheritance tax (or estate duty) if he had not got the cue from Rahul Gandhi's promise to carry out a comprehensive (which he called historic) survey to find out who holds the country's wealth and then take revolutionary measures (which, given the tone and tenor of Gandhi's recent speeches, meant redistribution of such wealth).
But aren't Gandhi and Pitroda flogging a dead horse and giving political opponents a stick to beat them in this election season? Already, PM Modi has said that the Congress wants to loot the dead too.
Talking about reviving a tax that was abolished in 1985 by Rajiv Gandhi is retrograde - apart from being bad economics and worse politics. The tax yielded a pittance and the cost of collecting it was more than what the government got. That was one of the strongest reasons to abolish it, apart from the fact that the then finance minister, V P Singh, said that the tax had failed to meet its objectives.
There is no doubt that people will rightly start raising concerns (and there is nothing urban Naxal about it) when too much of the nation's wealth is concentrated in the hands of too few, as is happening in India now. The richest 1% in the country holds more than 40% of the nation's wealth. This glaring inequality sends people scouting for measures to reduce it or redistribute the wealth. But the tried and failed inheritance tax is not one of them.
The debate over redistribution of wealth is important (even the Supreme Court is seized of the matter) and needs better inputs than the reintroduction of estate duty or inheritance tax. Although the Congress has rightly distanced itself from Pitroda's remarks, it has done little to provide any constructive view other than talking about 'revolutionary' measures. This has left it open to criticism and the BJP is using it to its advantage. The Congress should take forward the excellent work it did in opening up the economy in the 1990s and also stick to the mission of simplifying the tax structure as outlined in its manifesto by steering clear of such ambiguous and retrograde ideas.
