UPA survives Opposition ire...LS clears Finance Bill

The Government survived an Opposition onslaught in parliament and also managed to clear the Finance Bill as the Yadav chieftains and Mayawati threw their weight behind the UPA to keep the "communal forces at bay". All efforts by the BJP and the Communist parties to corner the Congress-led coalition on a spate of issues - IPL row, Phone Tapping controversy and price rise - came to naught. Interestingly, the RJD and SP backed Left parties' a Bharat Bandh agitation to protest against the Government's failure to rein in spiraling prices, especially that of essential commodities. In another bizarre development, Sibu Soren voted in favour of the UPA during the cut motions moved by the BJP. The saffron party then announced it would withdraw support to the Soren government in Jharkhand, only to back track on the move on Friday. Despite the BJP's 'U' turn, the JMM was still divided on whether to stick with it or go with the UPA in Jharkhand. Meanwhile, Jharkhand chief minister Shibu Soren wrote to BJP president Nitin Gadkari apologising for voting for the UPA in the cut motions for the demands for grants in relation to the budgetary proposals.

Talking of the Union Budget, finance minister Pranab Mukherjee rejected the Opposition's demand to rollback the hike in taxes on petrol and diesel. A reversal in the prices of fertilizers was not affordable in view of the economic compulsions, he said. Mukherjee announced a debt relief package for coffee growers besides making marginal changes in tax proposals to benefit sectors such as construction and encourage the setting up of new hospitals. At the same time, he rejected the demand for waiving the service tax on air travel saying that the levy on domestic travelers would only be Rs100 per ticket, while international travel would attract a maximum tax of Rs500. Mukherjee pointed out that while the fresh concessions would mean a revenue loss of about Rs3-4bn during the fiscal year. The entire Opposition walked out in stages, starting with the BJP, and the Lok Sabha passed the Finance Bill by a voice vote after including the relevant official amendments. " Any additional burden at this juncture could indulge in financial profligacy that I cannot afford to do...oil price is so volatile...when will it go up...nobody knows," Mukherjee said.

The Finance minister said that construction of hospitals with at least 100 beds in any part of the country would qualify for tax concessions based on their investment. He also restored the customs duty concessions for ‘ostomy' appliances which are used to treat cancer patients while reducing the basic customs duty on 11 drugs to five per cent. Likewise, to render tax relief to the construction sector, Mukherjee announced that by providing higher abatement, the newly imposed service tax would be levied only on 25% of the total value of the property, including land, instead of on 33%, as was proposed in the Budget. For the benefit of the urban poor, the Finance Minister also waived the service tax on low-cost housing under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) and the Rajiv Gandhi Awas Yojana.