New Delhi: Finance Minister Nirmala Sitharaman on Friday said the Indian economy suffered the biggest contraction due to Covid-19 pandemic, but the government has been able to contain retail inflation at 6.2 per cent.
Replying to a general discussion on the Union Budget in Rajya Sabha, the minister said, the Budget for 2022-23 fiscal year, stands for continuity, brings stability to the economy along with predictability of taxation. The objective of the budget is a stable and sustainable recovery in the economy, she said.
Compared to the performance of the UPA government during the global financial crisis in 2008-09, she pointed out that retail inflation was 9.1 per cent during the financial crisis of 2008-09, while it is at 6.2 per cent during the Covid-19 pandemic that has a bigger impact on the economy.
The Minister said the Indian economy suffered the biggest contrac She also said tion due to the pandemic. It suffered Rs 9.57 lakh cr loss due to the pandemic, compared to a loss of Rs 2.12 lakh cr during the global meltdown in 2008-09. Capital spending gives much more multiplier than revenue route and so the government has raised public capital spending to boost the economy.
Meanwhile, the Finance Minister said the government has sovereign right to tax profit made from cryptocurrency transactions, and the decision on banning or not banning will be taken based on feedback from consultations.
Replying to the general discussion on Union Budget, the Minister said, I am not going to legalise it or ban it at this stage.
Banning or not banning will come subsequently, when consultations give me input. About the profit emanating from transactions in cryptocurrencies, she stated that (Whether it is) legitimate or illegitimate, it is a different question, but I will tax because it is a sovereign right to tax.
The Minister was responding to the questions raised by Congress member Chhaya Verma on cryptocurrency. Verma had asked about the legitimacy of taxing cryptocurrency.
Recently Revenue Secretary Tarun Bajaj said, ‘The government is open to āsome tinkeringā in the varied rates and holding period for computation of capital gains tax on shares, debt and immovable property, in a bid to make it simple.
Under the Income Tax Act, gains from sale of capital assets, both movable and immovable, are subject to ācapital gains taxā. The Act, however, excludes movable personal assets such as cars, apparels, furniture from this tax.
Bajaj said the current capital gains tax structure is too complicated in terms of varied rates and period of holding across the assets and hence needs a relook.
We need to rework the capital gains structure for rates, holding period We would be open to some tinkering in it the next time we get an opportunity, Bajaj said at a CII event.