New Delhi [India], Sept 21 : Reacting to Finance Minister Nirmala Sitharaman's decision to slash corporate tax rate to 22 per cent from 30 per cent as part of the stimulus measures to revive slowing economic growth, Congress leader Pawan Khera on Saturday alleged that the government is supporting only the corporate sector of the economy and questioned the motive of the step taken.
"Problem is with the demand side and not with the supply side. If people are unable to buy then you cannot give stimulus to manufacturers and sellers. Please increase the purchasing power of those who will buy these products. You (government) are only supporting the corporates," Khera told here.
Questioning the rationale of the decision, he said "If a corporate earns 1000 crore profit then you have reduced his tax slab to 25 per cent but for a salaried person, tax slab is 30 per cent. What logic is this?"
Khera asserted that there was a slowdown in the demand and that is why the economy has shown a 'slump'.
"Stimulus should be given at the bottom so that people can buy and there should be a spur in demand then manufacturing plant will attain their optimal utilisation," he added.
Bringing in tax cuts and fiscal reliefs through an ordinance, the government had on Friday slashed domestic corporate tax to an effective 25.17 per cent, inclusive of all surcharges and cess, in a bid to promote growth and investments amid an economic slowdown.
( With inputs from ANI )