The Polit Bureau of the Communist Party of India (Marxist) has issued the following statement:
No Increase in Indirect Taxes
The Polit Bureau of the CPI(M) strongly denounces the decision of the Union Cabinet to permit massive hikes in excise duties to raise additional revenue through the issuance of an ordinance. It is clear that the Vajpayee government is using the excuse of a possible Indo-Pak conflict to impose greater burdens on the people. The reality is that there has been a massive shortfall in revenue collections due to the deepening of the recession in the economy. This decision to hike excise duties and other indirect taxes is being taken essentially to control the burgeoning fiscal deficit and also in order not to displease the IMF.
When the current budget was announced, the CPI(M) had pointed out that the provisions hailed by the corporate world, would only exasperate the recessionary conditions because of imposing further burdens on the people and, thus, contracting the domestic demand in the economy. This has been vindicated.
Now by proposing to further increase indirect taxes, the Vajpayee government, apart from imposing extra burdens on the people, will further reduce the purchasing power amongst the Indian people compounding the recessionary trends.
Instead of putting the burden on the rich through increases in direct and corporate taxes, the recourse to indirect tax increases clearly exposes the anti-people and anti-poor policies of this Vajpayee government.
The CPI(M) warns the Vajpayee government that the people will not tolerate further attacks on their livelihood.