While many have commended the government’s stance on refusing to go back on the customs and excise duty hike on oil products, the real reason is the government has too much riding on it — close to Rs 25,000 crore of revenues will come from here. Since a third of these revenues will accrue to the states, the state chief ministers must be telling their central party offices to go slow on the agitation.
The other issue pertains to those pointing out the tax assumptions are too rosy. In the past, when the economy has come out of a slowdown, the revenue buoyancy has been very high. So, it is not inconceivable that tax revenues will rise to the required levels. For GDP to grow, the government must implement all the mini-reforms outlined in the Budget statement.
S Joshi, New Delhi