ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Geep Flashlight Industries Limited, Allahabad

any contradiction between the guiding principle's cogently argued in the first chapter of its Report and its basic recommendation that all the agricultural income groups above as low an income level as Rs 600 per annum should he subjected to a progressive direct tax under AIIT. It also suggesis a uniform levy of Re 1 per holding with incomes below Rs 600 per annum. The Committee tries to rationalise its recommen- dation for taxing the lower income groups in the following terms: "In fact, payment of land revenue, or some tax on holdings, is itself widely regarded by landholders as necessary evidence of their rights in their holdings" (p 43). lf land revenue is so popular with the small fanners, it is difficult to explain why there have been moves for its abolition in state after state! The crux of the matter is that the. Committee Tailed to muster enough courage for facing the question of inter- sectoral equity squarely. Exempting lower agricultural groups from direct FROM THE CHAIR taxes would, of course, mean a sizeable loss of revenue. The Committee allowed itself to be guided by the fiscal expedient and apparently considered it wiser to sacrifice this aspect of equity for the .sake of revenue rather than vice- versa.

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