Sir even though the bill comes to this
house for the first time I had touched
upon this subject in my budget speech
in may last and its principles figured
prominently in the course of the general
discussion on the budget the two
booklets explaining the general the new
taxation proposals have been circulated
to the hon. Member of this house the
house will therefore agree with me that
it is unnecessary to cover the same
ground detail in my introductory speech
especially as the various provision will
come up for detailed discussion later
one I will confine myself have made in
the original provision in the course of its
passage in the other house at the outset
I should say that the broad principles of
a tax on the wealth have received warm
support in the other houses from a large
section of the public though there was
criticisms over some particular provision
are re examined a original provision in
the light of criticism from various
quarter are re examination has only
strengthened the justification for the tax
sir the tax is new to the country but it is
not new to the world it constitutes a
very vital element in the taxation
system of most progressive countries
the European and American continents
its importance should not be judged
form its revenue content I do not for a
moment say that the revenue
consideration should be absolutely ruled
out important but the real importance
of the tax from my point of views lies in
the fact that it facilitates the
reorientation of the tax structure in the
integrated pattern it is not only welcome
supplement but also a corrective to it
which certain objectives of tax policy
which cannot be achieved through the
income tax alone can be achieved
through the combined of the new tax sir
I may mention that there has been
much controversy about the question of
levying wealth tax on companies the lok
sabha went very careful into this matter
that the having regard to the corporate
structure in india it is possible to
exclude such tax from the levy.
As the house is aware every individual
hindu undivided family will be liable to
pay the wealth tax so as are concerened
the exemption limit is Rs. 2 lakh
companies to Rs. 5 lakh no changes in
the other house in regerard to the limits
of these two classes hindu undivided
families exemption limit has been raised
from Rs. 3 lakh to Rs.4 lakh at the same
time the next slab range has been
reduced from the Rs. 10 lakh to Rs. 9
lakh taking companies whether it is
public or private whether Indian of
foreign to pay wealth tax a resident will
pay the wealth whether such wealth is
held in the india or outside a non
resident company in india will pay the
wealth tax under clause 45 its excluded
from wealth tax the bill orginally stood
excluded banking companies insurances
companies certain finanicial institution
sponspored by the central government
has now been added for the promotion
of art culture and commerece etc which
are not establish for the purpose of
making profit in which registered as
companies for the sake of convience of
administration the another important
change is that the wealth tax holiday
will be granted for the 5 successive
assesements years immediately
following this years provided not only a
the incentive in the industrial
enterprises but also a view of avoiding
any financial difficulty of organization
the wealth tax holiday extended to new
industrial units created by the way of
substantial expansion undertaking the
as a corollary for new industrial
companies shareholders in such
companies will also be similarly dealt
with on the value of their shares like
period of successive assessment years
in which are themselves will be enjoying
the wealth tax holiday I may point out to
this because the attitude of the mill
owner of sugar factories of bihar and
uttar Pradesh increasing the demand
among the peasant of these states that
there sugar factiores should be taken
by the government and run as the
public enterprises as point out by the
friend it is under existing law for the
government to do so if the government
to desires.
