Government has no plan to impose any tax on agriculture income: FM Jaitley

Jaitley said that as per the constitutional allocation of powers, the central government has no jurisdiction to impose tax on agricultural income.

New Delhi: A day after NITI Aayog member Bibek Debroy made a strong case for taxing agriculture income,  Finance Minister Arun Jaitley said that the government has no plans to impose any tax on agricultural income.

"I categorically state that the Central government has no plan to impose any tax on agriculture income," Jaitley said in a tweet, clarifying that the Centre has no constitutional authority to tax agricultural income.

A ministry of finance tweet said:

FM @arunjaitley : I categorically state that the Central Government has no plan to impose any tax on agriculture income . — Ministry of Finance (@FinMinIndia) April 26, 2017

As per the constitutional allocation of powers, the central government has no jurisdiction to impose tax on agricultural income, the tweet further said.

FM @arunjaitley :As per the Constitutional Allocation of Powers, the Central Govt has no jurisdiction to impose tax on agricultural income. — Ministry of Finance (@FinMinIndia) April 26, 2017

Debroy had said on Tuesday that taxes should be imposed on agricultural income above a certain threshold in order to expand the tax base.

"On expanding the base on the personal income tax side, other than elimination of exemptions, is to also tax rural sector, including agriculture income above certain threshold," Debroy said.

The NITI Aayog in a statement on Wednesday said that Debroy`s suggestion is neither the view of the Aayog "nor is such a recommendation made anywhere in the Draft Action Agenda document as circulated to the Governing Council at the meeting on 23rd April 2017."

"NITI Aayog notes that the views on taxing farm income expressed by Member Bibek Debroy were personal and not those of the Aayog," it added.

NITI Aayog Vice-Chairman Arvind Panagariya, who was present at the press conference, however refrained from answering questions on taxation of agriculture income.

In May 2016, the Prime Minister's Office had advised the NITI Aayog to prepare documents on 15-Year Vision, Seven-Year Strategy and Three-Year Action Agenda.

With Agency Inputs