Why Centre did not reduce tax slabs for middle class despite record GST collection? PEA Sanjeev Sanyal answers

Sanjeev Sanyal answered why the government did not reduce the tax slabs for the middle class despite the record GST collection as mention by Finance Minister Nirmala Sitharaman

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The much-awaited Budget 2022 was finally tabled in the Lok Sabha on Tuesday by Union Finance Minister Nirmala Sitharaman. And as expected the opposition parties are not happy with Budget 2022.  While many new sectors were mentioned in the Union Budget 2022, one of the most anticipated factors which remained untouched was the tax rates. 

Nirmala Sitharaman during her budget speech informed the Parliament that the Goods and service tax (GST) collections in January 2022 hit a staggering Rs 1,40,986 crore, the highest since the rollout of the indirect tax regime. However, Sitharaman did not reduce the tax slabs. Following that the opposition, as well as people on social media, started expressing their displeasure. It is pertinent to mention here that the tax slabs have not been changed since 2014. 

Following this, Principal Economic Advisor Sanjeev Sanyal was asked about the same. Sanjeev Sanyal was talking to Aaj Tak when he was why the government did not reduce tax slabs despite record GST collection. On that, Sanjeev Sanyal became furious and also had a little argument with the journalist. 

However, Sanjeev Sanyal answered why the government did not reduce the tax slabs for the middle class. He said, "I have nothing to do with what the opposition is saying on the tax slabs in Budget 2022. You are talking about the reduction of tax slabs. Ok, let's suppose we would have reduced the tax slabs, now you tell us on which sector we should have spent less?" 


However, when countered and told that the middle class was expecting some exemption in the tax slabs especially when the GST collection has broken all records as mentioned by Nirmala Sitharaman, PEA Sanjeev Sanyal said, "We want everyone gets profited be it in form or tax or in terms of spending. We decide our policy according to the situation. We were in a pandemic for the last two years. Our economy is still recovering from that but the momentum is still firing. In such conditions, whether we should tax or spend on infrastructure?," added Sanjeev Sanyal.  

Furthermore, Sanjeev Sanyal said, "So we decided to take a step towards infrastructure. Two things will happen by this- Infrastructure is the need of the country. We need highways, airports. So it's a good time to construct those. Second, with the improvement in infrastructure investment will come and ultimately people will get jobs. So, in order to increase demands and infrastructure capacity, we have to invest in it. If we have to invest money then there are only two ways- by borrowing from the market or you can use the tax money. So, tell us if we decrease the tax, should we take more loans?" 

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