Congress Manifesto 2024: Party Promises To Enact Direct Taxes Code, Abolish Angel Tax

Congress Manifesto 2024: The Congress alleges that the burden of taxes on the common person and the poor has surged due to regressive indirect taxes, while corporate tax contributions have dwindled

In a scathing attack of the BJP/NDA government's taxation policies, the Congress Party has vowed to initiate a comprehensive overhaul of India's tax system, labelling the past decade as a period of 'taxation gone berserk'. In its Election Manifesto, the Congress alleges that the burden of taxes on the common person and the poor has surged due to regressive indirect taxes, while corporate tax contributions have dwindled. This, they argue, stands in stark contrast to the principles of a progressive and people-friendly tax regime.

Congress Manifesto 2024

Despite claims of expanding the tax base through measures like demonetisation and the implementation of Goods and Services Tax (GST), India's overall tax-to-GDP ratio has remained stagnant over the last ten years, constraining avenues for increased public expenditure.

Direct Taxes Code

The party will enact a Direct Taxees Code, aimed at ushering in an era of transparency, equity, and impartial tax administration. Additionally, stable personal income tax rates throughout the party's term are promised, providing certainty for the salaried class in financial planning.

Abolition of Angel Tax

The party pledges to abolish ‘Angel tax’ and other exploitative tax schemes hindering investment in new micro, small companies, and start-ups. Furthermore, Congress aims to alleviate the tax burden on Micro, Small, and Medium Enterprises (MSMEs) owned by individuals and partnership firms.

GST 2.0

A key aspect of the proposed changes is the replacement of current GST laws with GST 2.0, built on the principle of a single, moderate rate (with exceptions) to prevent undue burden on the poor. Agricultural inputs will be exempt from GST, and the GST Council will be restructured to ensure policy autonomy.

Under the proposed framework, GST administration will be horizontally divided between the central and state governments, with small GST payers falling under the purview of the latter. Additionally, a portion of GST revenues will be allocated to local bodies such as panchayats and municipalities.

To provide relief to small retail businesses facing stiff competition from online counterparts, significant tax concessions will be granted. Furthermore, judicial bodies overseeing tax matters, including the Income Tax Appellate Tribunal (ITAT) and Goods and Services Tax Appellate Tribunal (GSTAT), will operate autonomously without government interference.

The Congress Party's taxation reform agenda aims to address perceived inequalities and inefficiencies in the current system, promising a more equitable and efficient tax regime if they come to power.