{"id":73560,"date":"2020-12-18T18:12:20","date_gmt":"2020-12-18T12:42:20","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=73560"},"modified":"2021-03-11T14:32:02","modified_gmt":"2021-03-11T09:02:02","slug":"guaranteed-msp-will-claim-half-the-budget","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/guaranteed-msp-will-claim-half-the-budget\/","title":{"rendered":"Guaranteed MSP will claim half the Budget"},"content":{"rendered":"<p><strong>Context:\u00a0<\/strong>Procurement of 23 crops at <a href=\"https:\/\/forumias.com\/blog\/why-farmers-are-protesting-and-what-is-msp-system\/\" target=\"_blank\" rel=\"noopener\">MSP<\/a> which will amount to \u20b917-lakh cr and to support this annual allocation, rich farmers should pay tax.<\/p>\n<p><strong>What is the farmers \u2019demand?<\/strong><\/p>\n<ul>\n<li>The protesters have rejected the offer of amendments to farm laws and are firm on their demand for repeal of the three laws.<\/li>\n<li>Farmers want MSP guarantee.<\/li>\n<\/ul>\n<p><strong>Is it feasible to accept demand of MSP guarantee?<\/strong><\/p>\n<ul>\n<li><strong>Not economical<\/strong>: India has about 14 crore farmers (as per PM-KISAN enumeration). Cost of procuring all 23 crops is 50 per cent of India\u2019s annual expenditure<\/li>\n<li><strong>Unsustainable burden<\/strong>: The cost of MSP and subsidised food supplies are being met by heavy borrowings from the National Small Savings Fund (NSSF).<\/li>\n<li><strong>Rising subsidies:\u00a0<\/strong>In 2019-20, 11 per cent of the country\u2019s total budget was spent on farmer welfare schemes. Subsidies on food and fertiliser and expenses on irrigation schemes in 2019-20 noticed a 65 per cent jump from 2017-18.<\/li>\n<li><strong>Direct benefit:<\/strong>\u00a0introduction of the PM-KISAN scheme resulted in leap in food subsidy.<\/li>\n<li><strong>Rise in procurement:<\/strong>\u00a0Procurement of food crops including paddy, wheat, pulses and oilseeds under MSP has seen a dramatic increase. For example, compared to 1,395 lakh tonnes of wheat procured between 2009 and 2014, 1,627 lakh tonne of wheat have been procured in the last five years.<\/li>\n<\/ul>\n<p><strong>What are the other issues?<\/strong><\/p>\n<ul>\n<li><strong>Disparities<\/strong>: MSP\u2019s poor implementation has created problems of equity with large farmers of just two States Punjab and Haryana.<\/li>\n<li><strong>Faulty policy:<\/strong>\u00a0As per CACP, more than 95 per cent paddy farmers in Punjab and about 70 per cent farmers in Haryana are covered under MSP operations. States such as Uttar Pradesh (3.6 per cent), West Bengal (7.3 per cent), Odisha (20.6 per cent) and Bihar (1.7 per cent), have only a minuscule number of farmers benefit from procurement<strong>.<\/strong><\/li>\n<\/ul>\n<p><strong>Why blanket exemption on taxing agriculture income is bad policy?<\/strong><\/p>\n<ul>\n<li>Agriculture income including that from sale of farmland is exempt under Section 10 (1) of the Income Tax Act, 1961 without any limit.<\/li>\n<li>Rich farmers and politically influential people use the provision to convert black money into white.<\/li>\n<li>Rich farmers include many corporates who run seed companies and whose profits run into crores.<\/li>\n<li>In 2019, a Comptroller and Auditor General report red-flagged the\u00a0<strong>irregularities in exemptions<\/strong>\u00a0given by the taxman on agriculture income.<\/li>\n<li>It said that claims of tax exemption on farm income were given based on \u201cinadequate verification or incomplete documentation\u201d in more than a fifth of the 6,778 cases.<\/li>\n<li>Exemption was granted in hundreds of cases where land records or proof of farm income was not available.<\/li>\n<li>According to an article published in the Economic and Political Weekly by Govind Bhattacharjee, a retired Director General from CAG, assesses who had reported agricultural of more than \u20b95 lakh each between 2014-15 and 2016-17 were 22,195.<\/li>\n<\/ul>\n<p>The blanket exemption on agriculture income should be stopped and it should continue for roughly 86 per cent of the peasants of the country. The 14 per cent rich farmers should come forward to help the rest get MSP support.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Context:\u00a0Procurement of 23 crops at MSP which will amount to \u20b917-lakh cr and to support this annual allocation, rich farmers should pay tax. What is the farmers \u2019demand? The protesters have rejected the offer of amendments to farm laws and are firm on their demand for repeal of the three laws. Farmers want MSP guarantee.&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/guaranteed-msp-will-claim-half-the-budget\/\">Continue reading <span class=\"screen-reader-text\">Guaranteed MSP will claim half the Budget<\/span><\/a><\/p>\n","protected":false},"author":61,"featured_media":73563,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,1351,1310,9],"tags":[1285,1314],"class_list":["post-73560","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-9-pm-daily-articles","category-daily-news","category-daily-news-updates","category-public","tag-agri_0","tag-agri_6","entry"],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2020\/12\/Guaranteed-MSP-will-claim-half-the-Budget.jpg?fit=1280%2C720&ssl=1","views":{"total":0,"cached_at":1700772079,"cached_date":1704268447},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/73560","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/61"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=73560"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/73560\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media\/73563"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=73560"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=73560"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=73560"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}