Recommendations to Covid19 Economic Response Task Force

Sl No	Recommendation	Remarks / Justification / Explanation
1.	No tax on Dividends from Shares & MFs for people above 60	This is a must,  as persons above 60, of whom almost 90 % are retired persons,  have only this and FDs as source of income.  The withdrawal of Tax Exemptions on Dividends as well as the Rs. 50K FD interest tax exemption withdrawal has dealt a severe blow to them and also pushes them onto huge amount of paper work that will require auditor assistance and expense. This move will make the Govt. immensely popular & responsive ;  will win you huge plaudits & also give significant relief to the Sr Citizens
2.	The Limit for Professionals to register for GST is raised from the current Limit of Rs. 20 Lakhs to Rs. 40 lakhs,  to bring it in line with other businesses.	The low limit of  Rs. 20 lakhs is pushing a large number of Professionals to compulsorily register for GST  with the whole paraphernalia of Filing Returns, Keeping Records, paying additional Fees to the Auditor  which his size of operation cannot afford.  Besides by not registering, it will actually favourable impact Government Revenue as these Professionals will not be able to claim any Input Credit against GST paid by them, Further,  it brings about a kind of symmetry with other "non-professional"  business which has a threshold limit of Rs. 40 lakhs, only  above which GST registrations is compulsory.

Sl No	Recommendation	Remarks / Justification / Explanation
3.	BASIC IT Exemption Limit to be raised to Rs.. 7.5 lakhs for people above 60 and to Rs. 10 lakhs for people above 80	Earlier Basic Exemption Limit was Below 60 years               – 2.5 Lakhs Above 60 but below 80   – 3.0 Lakhs   (i.e. 20 % more than 1st Slab) Above 80 years                        – 5.0 Lakhs   (i.e. 100 % more than 1st Slab)    This suggestion is to make the same parity, as before CURRENT (recommended) Below  60 years              - Rs. 5 lakhs Above 60, but below 80  - Rs. 6 lakhs (i.e. 20 % more than 1st Slab) Above 80 years               - Rs. 10 lakhs (i.e. 100 % more than 1st Slab)    This move will assuage a lot of the anger and disappointment that has come from the Budget Proposals as the increase of Basic Limit to Rs. 5 lakhs does not adequately compensate for the withdrawal of commonly availed deductions like HRA, LTA, Sec 80 C, Shares & MF Dividends, FD Interest  Exemption of  50K.  In case of persons above 80 years they were already enjoying exemption of Rs. 5 lakhs. Of course,  there is a cost,  but it will greatly mollify the salaried class and Senior Citizens who are an important voting bloc and also very influential in their own ways. Some realpolitik has therefore to be resorted to in this case.

Sl No	Recommendation	Remarks / Justification / Explanation
4.	For all those buying subsidized LPG Cylinders,  they will get a discount of  Rs. 100/- per cylinder for a maximum of 12 cylinders during the period from April 2020 to March 2021. Thereafter,  prices will be charged as per pricing formula currently being used.	This will show your sensitivity to the lower income group and shield you from accusations that you do not care for the poor and the less privileged.  Besides, this facility is meant to be operable only for 1 year and therefore has a limited life and limited “revenue-damage”  potential
5.	Farmers will be given Seeds as Loan from National Seed Bank to be repaid within 3 months after harvesting in a maximum of 3 instalments without charging any interest.	This will be warmly greeted by the farming community and show /prove your credentials that you are sensitive to the farmer’s needs which is one of your declared priorities.
6.	All Sugar Cane Farmer dues will be cleared by all concerned State governments within next 90 days.	This will be also be warmly greeted by the SUGAR farming community and, once again,  show / prove your credentials.
7.	Kisan Samman amounts to be raised by 25 % from present Rs. 6000 to Rs. 7500/-,  each instalment now becoming  Rs. 2500/-	Once again, this will be very warmly welcomed by the entire farming community in the country and put tremendous pressure on “absentee” States to join the scheme.
8.	Advance payment of  50 % of  Next Kisan Samman Yojana -  yes, by printing money,  if necessary.	This gesture and support is absolutely essential to recognise the plight and difficulty of Farmers.

  

Sl No	Recommendation	Remarks / Justification / Explanation
9.	All exporter’s duty drawback,  and incentive amounts due as on March 31, 2020, as assessed by the Government,  will be paid by 31st May 2020 at the latest.	There has been continuous complaint about this and the exporters earning valuable foreign exchange for the country feel very cheated when they are denied their legally due benefits.  This measure will make them very re-assured and win you strong supporters.
10.	All approved IT Refunds remaining unpaid as on 31 Mar 2020  will be paid by  30th  April 2020.	This will greatly improve cash flow for the ordinary citizen and thus inject liquidity in the entire economic system, leading hopefully to greater demand and purchases.
11.	All Loans above Rs. 20 Crores given up to and including 31st March 2019  and not having more than one delayed payment every year up to a maximum of  5 such delayed payments in ALL, till  date,  will get a rebate of 1 Monthly instalment for the month of April 2020 for improving current cash flow.	This will free Corporates from Cash Flow difficulties and give them a breather till things turnaround, business picks up and their normal cash Inflow  begins.
12.	For loans below 20 crores,  rebate of  1.5 Monthly instalments for April & May 2020.	Same argument and expected benefits for smaller companies
13.	For loans  below  1 crore,  rebate of  2 Monthly installments  for April & May 2020	Same argument and benefits for individuals,  who will  all, most probably,  fall in this bracket.
	NOTE	While Recommendations 11, 12 & 13  will essentially apply to PSBs, RBI & Government can nudge the Pvt. Sector & Co-operative Banks to also implement the same concessions.

  

Sl No	Recommendation	Remarks / Justification / Explanation
14.	LTCG Tax on shares & MFs to be scrapped and instead the Long-term period to be raised to 3 years form current 1 year.	This must be done – the LTCG earnings are a pittance compared to the complicated calculations and cost of “Auditor help”  that even an individual has to take. By raising the Long-term period definition to 3 years,  the Government will very effectively meet its basic objective of preventing sudden and quick upheavals in the Capital market. And if anybody wants to exit earlier,  then, of course let them pay applicable Income tax, bereft of any concessions on account of capital gains.
15.	For Next 12 months,  all existing Housing Loans from PSU Banks to charge 2 % Less interest  and all new Loans for a repayment period not exceeding 15 years to get a 2 % interest subvention.	While this may appear to be a huge cut in income of banks,  actually it is a very nominal cost to pay for making life easy for the common man for a limited period of only 1 year. It’s psychological impact will,  however, be tremendous. The same facility for new loans will hopefully encourage new house purchase which should kick-start many other segments of the economy like furniture, domestic appliances, textiles, lighting, plumbing and so on.

  

Sl No	Recommendation	Remarks / Justification / Explanation
16.	For all discounts offered by the builder exceeding 15 % on published prices of Houses as on 1 March 2020,  50 % of the discount amount will be Tax exempt.  This is to encourage builders holding unsold inventory to dispose of current stock at a discount and thus pay back their loans to the banks and thereby put money into circulation.  This will be valid for period of 12 months from 1 April 2020 to 31 March 2021.  The discount given will be added back to income if during the pendency of the payment the builders raise the prices on one pretext or the other.  This will not apply to Projects announced after 1st March 2020.	This move is to encourage Builders to stop hoarding, simply because of their “staying power” or “collusion with banks”  and  will help to reduce existing stock that is simply lying idle. This will tremendously help the Bank’s cash flow as builders will now be in a position to service their loans much better, which will have it’s own cascading beneficial effects on the economy.
17.	Toll on Highways will be reduced to 50 % for all Trucks and tempos for a period of 3 months starting from 1st April 2020 till 30th June 2020.	This is a industry friendly gesture in these times of earning difficulty and reduction.  In any case, it is proposed only for a limited period of 3 months till  30 June 2020.
18.	All Taxi & Auto Drivers will be given 50 % rebate on RTO Fees as well as on “Vehicle Passing Fees” for the year April 2020 to March 31, 2021.	This is to acknowledge the very hard hit the taxi/auto plying driers have taken because of loss of business.

  

Sl No	Recommendation	Remarks / Justification / Explanation
19.	Ask Industrialists & Business Houses to donate to CORONA Relief Fund	While it is really up to the Industrialist / Business Housed to decide the amount, hint to them that Rs. 100 Crores donation per Company  is expected from the Top 500  such Cos/ Biz  Houses including PSUs.  This can also come out from their unspent CSR Funds.
20.	Ask BCCI & IPL to donate Rs. 100 Crores each
21.	Ask Film, Singers/ performing Artistes and leading Sportspersons to donate to CORONA Relief Fund.
22.	Get BJP to donate 100 Crores to Corona Relief Fund and ask other parties to give what they can.
23.	Use this fund to direct transfer to all those holding Jan Dhan Acct - 250/- per week for 1 Month (Rs. 35,000/- Crores) & extend by another month if economy still remains at standstill.	This is a sizeable expense and will have to financed by deficit.  However, it is essential given the circumstances.  Will also greatly upgrade usefulness of “JAN DHAN ACCOUNTS”
24.	Ask all B & C Grade Restaurants to give discount  of  20 % on every  Bill to Customers for 2 Months Only (i.e. Apr & May 2020) &  Govt shouldn’t   collect 5 % GST from them, even though it is charged. This means an  effective discount of 15 % only.	Will help the huge number of people who eat out daily.  But this is a temporary relief for 2  months  only  - April & May 2020,  to tide over the present crises.

hemendra k. varma
mumbai
24 March 2020

Priorities for the new Shivraj Singh Chouhan Government in Madhya Pradesh - A CITIZEN’S VIEWPOINT

It is inevitable that by  today evening will see the BJP back in power in Madhya Pradesh.  It will be a major challenge for Shivraj Singh to not only get back to power but to stay on in power as his continuance is dependent on the results of the 24 bye-elections that will have to be filled within the next 6 months to full the Assembly vacancies caused by the 22 resignations and 2 earlier vacancies.

In my view,  this is what the priorities of the new BJP Government should be :

1.   Declare that its first and topmost priority is securing the State against the onset of Corona Virus, on which MP has been extremely fortunate and lucky so far. For this the following steps need to be taken :

            a)     Immediately stop all Bus Services from out of State into entering MP  till March 31.

        b)    Initiate fumigation and disinfecting of all Public places like – Bus Stands,  Railway Stations, hospitals, Municipal Offices  District and High Courts,  Prisons, Tourist Spots

           c)    Request all PSUs to shut down operations till March 31 and re-open in phases,                            thereafter,  based on the situation prevailing till then.

         d)    Ask all Schools to promote students to the next Class for Classes 1 to 8 without any Final, year-end Exams.  This will not only prevent congregation of students for the examination but also relieve students and parents alike of mental anxiety and tension which is also very important in this time of crises.

           e)     Order all Cinema Halls and Air – Conditioned Malls Closed till March 31, 2020.

           f)      Order all other shops to be open only on alternative days.

           g)     Issue immediate appeal to all people to follow the appeal of the PM to ensure that

1.  the young (below 10) and the elderly (above 65) do not come out of their houses for the next 2 week’s

2. Sunday’s Janata Curfew should be made a resounding success – be careful to strongly APPEAL but not threaten at all ; especially caution your over-enthusiastic Ministers and party Karyakartas to not make any threatening kind of statements on this matter.

      h)    Set up a Chief Minister’s Corona Virus Protection Fund and ask for generous donation               from Industries and the common citizen.  This should be a distinctly separate fund and not           mixed up with the Consolidated Fun d nor used for any other purpose – such separation             and integrity of deployment is extremely important.

      i)     Ask all Pharma Industries in the State to either donate palliative medicines or Testing Kits.

      j)      Install and Increase CORONA  Testing facility in every District.

     k)    All expenses incurred by Companies and donations given by industry/individuals should be        made a tax free expense.

2.  Make a special overture and effort to woo the farming community who had felt neglected and cheated by your previous administration and which led to your defeat.  NO matter that the truth is different,  but the perception was clearly of dissatisfaction. 

Hence the CM, Finance Minister and Food & Agriculture Minister should undertake a whirlwind tour of the entire state to meet with farmer’s bodies, co-operatives to give them a personal hearing, understand what is causing them difficulty / heartburn and try to expeditiously address these concerns. 

This should be done on priority,  and with a sense of urgency,  particularly in matters of payment of Fasal Bema Yojana and Kisan Samman Yojana. 

In case of the latter,  use the BJP party members to ensure 100 % registration of eligible farmers so that they receive their first instalment of Rs. 2,000/-  at the earliest.

3.  Announce and implement an urgent budget for upgrading of infrastructure in the following 3 areas where maximum number of common citizens, particularly form the lower economic strata come ;

           a)     Bus Stands

           b)    Municipal Hospitals and

           c)     District Courts

The infrastructure improvement in these areas will be very visible,  and favorably impact a huge segment of the regularly voting population,  which only can ensure your continuance in power.

4.  Immediately reverse all transfer and appointment decision of the Kamalnath Government in the last one month – do not feel shy or hesitant. Be ruthless and reverse them immediately.

5.  Similarly seek the resignation of all persons appointed by the Kamalnath Government in various Public & Autonomous Bodies (just as they had done)  or sack them immediately ; you must show that you are not only decisive but can be rough and tough.

Thereafter,  immediately appoint or reappoint your own persons.

6. Have a detailed and sincere dialogue with civil society of the   comprising Professors/Teachers, Doctors, Lawyers, Journalists, Retired Govt . Servants and Judges, Industrialists and leading farmers and agriculture experts  and ask them what they think are the priorities the Government should have for rapid development of the State. 

This will give a huge and actionable  “wish-list”  of what the people of the Sate want and if you act on these you will get widespread Public Support. 

Please video record all such dialogue and broadcast it in instalments so that there is complete transparency about what was asked and what was finally done.

7.   To ensure victory in 24 bye-elections due in the next 6 months, do the following,  from Day 1

             a)     Constitute 1000 man BJP Karyakarta teams for each constituency.

            b)    This team will have the responsibility that each member visits at least 400  homes in                   the next 5 months i.e. 80 homes per month i.e.   5 homes every day for 16 days in each               month. 

1.  This will enable 4 lakh homes to be visited in the constituency (80 homes per month X 5 Months X 1000 Karyakartas) . Each constituency is estimated to have approx. 1 Lakh homes which means that,  in the space of 5 months,  each household can be visited 4 times by this team to seek votes for the election.  It is this JAN SAMPARK  that will win you the election,  not merely the JAN SABHAS,  of which BJP is rather fond of.

2.  Remember,  massive JAN SABHAS only gets you good media coverage ; it is only the JAN SAMPARK at the person-to –person level that will get you the votes.

3.  So do not make the mistake of the last election of believing that if Narendra Modi, Amit Shah and a few Central leaders come and hold Road Shows and big public meetings you will win the elections ;  time and again this had been proved to be wrong (see Rajasthan , MP, Chhattisgarh, Maharashtra, & Delhi)

4. The Central leadership can only give you strength and morale boost – the foundational solidity of your efforts can only come if your Karyakartas carry out a rigorous, planned and structured  “Jan Sampark”  to meet each and every potential voter,  to knock on each and every door,  to hear the complaints, woes and expectations of each and every family.

5.  Such close touch with the voter will give you a lot of strength in not only getting their support but in also calling upon them to come out and vote.

hemendra k. varma

mumbai

20^th March 2020