1970-71: Indira’s budget1 min read . Updated: 15 Jan 2020, 11:51 PM IST
Mint picks 10 budgets which stand out for one or the other of these reasons
Historically budgets fall in two buckets. Those that are situational—dominated by an unravelling challenge and hence largely reactionary—and the few out-of-the-box essays seeking to reset the economic agenda. Mint picks 10 budgets which stand out for one or the other of these reasons.
Then prime minister and finance minister Indira Gandhi’s budget speech had growth and fairer distribution as key concerns—issues that still remain. Gandhi made the clearest exposition of the ‘bottom of the pyramid’ model in her maiden budget speech.
■ Indira Gandhi’s first and only budget speech highlighted several measures, including bank nationalization and the Monopolies Act, to achieve the twin goals of growth and social justice.
■ The budget made special provisions for several centrally sponsored schemes and discretionary transfers to social groups, combining social welfare expenditure with growth potential.
■ Her approach led to the centralization of expenditure, adding a new dimension to expenditure underwriting to the already existing revenue sharing in Union budgets.
■ The budget proposals used tax as a tool to raise revenue, reduce disparity and limit consumption of hand-picked commodities. It also identified taxation as a tool to equalize income.
■ While the peak income tax rate was 93.5% for income exceeding ₹2 lakh, excise duty on air conditioners was raised from 40% to 53.75%. Tax was also used to check tea’s domestic consumption.