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Arvind Subramanian: Rich and poor farmers should be distinguished to be taxed

Arvind Subramanian: Rich and poor farmers should be distinguished to be taxed
Picture Courtesy: HT

New Delhi: Chief economic adviser Arvind Subramanian on Friday said, there should be a distinction between the rich and poor farmers, while joining the debate of levying any taxes on the agricultural industry.

“The legal situation is… nothing prevents state governments from taxing agriculture income. The constitutional restriction is on central government taxing agriculture income,” he claimed.

“There too, one could make a case that this is a choice open to 29 state governments and if there are willing takers, all power to them,” he added, reported HT.

He also asked to make a clear distinction between the rich and poor farmers.

“Why is it that it is very difficult to make a distinction between a poor farmer and a rich farmer… When you say a farmer, people think that you are going after the poor farmer… So what is it about political discourse that does not allow these distinctions to be made? Why can’t we say, rich regardless of where they get their income, should be taxed,” he said.

NITI Aayog member Bibek Debroy suggested that the agricultural income should also be taxed, following which a controversy came into play. Finance Minister Arun Jaitley, however, clarified later that there was no such proposal and the Centre has no power to impose a tax on agricultural income.