New Delhi: NITI Aayog member Bibek Debroy on Tuesday said that agricultural income should be taxed and exemptions on personal income tax should be removed to increase the resources of state.
Such moves would widen the tax base and will provide more funds for the social sector schemes, he said.
“On the personal income tax side also exemption should go... On expanding the base on the personal income tax side, other than elimination of exemptions, is to also tax rural sector, including agriculture income above certain threshold," Debroy said in a press conference.
On the threshold of imposing income tax on rural sector, he said it could be decided after taking into account the average income of either three years or five years.
"I don't believe in artificial distinction of rural and urban, so whatever is the threshold on personal income side on urban side, should be the exactly same on rural side.
"At best what I can do because it is an agriculture income, instead of using agriculture income for one particular year, what I could do is I average it over three-year period or may over five years period as agriculture income is subject to annual fluctuations, barring that threshold should be the same," he said.
(With PTI inputs)
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