Feb. 28, IIF, New Delhi : While welcoming the Union Budget 2005-2006, Prof. J.D. Agarwal, Professor of Finance and Chairman, Indian Institute of Finance said that the budget would be growth oriented, non-inflationary and generate employment. The Finance Minister has been able to carry forward the spirit of National Common Minimum Programme (NCMP), Financial Consolidation, while distributing the much desired largees to all sections of the society.

Apparently, it has agriculture and rural bias but the expenditure allocation on rural and urban infrastructure, education and health care will benefit the industry and the urban centres of economy.

The Finance Minister through his tax proposals has tried to maintain a fine balance and has introduced simplification and provided relief through realignment of tax rates and tax slabs. The tax proposals would facilitate greater tax compliance feels Prof. Agarwal. However, his proposal to tax cash withdrawals of Rs. 10,000/- or more through bank on a single day holds no justification and if not rolled back would become counter productive as people who need to make justified expenditure will hold cash instead of keeping that money in bank said Dr. Agarwal. Domestic Industry deserved level playing field by alignment of tax duties and the reduction in custom duties.

Prof. Agarwal reiterated that government should ensure that all reductions in excise and custom duties are passed on to the consumers through adjustment in prices as is done when such duties are raised.

According to Prof. Agarwal, the Finance Minister has tried to please everybody and displeased none while targeting growth with stability and equity.