It’s not a populist budget, but a popular one, says Jaitley

‘CONSOLIDATING GAINS’ Budget a good blend of economy and politics as it builds on changes brought about by the government for the betterment of the country, says FM

NEWDELHI: The Union budget may have made the salaried middle class unhappy at the higher tax they will have to pay, the stock market fell on account of the Long Term Capital Gains Tax on equities, and been described as populist and political by some, but finance minister Arun Jaitley is convinced it is just what was needed at this stage of the Indian economy – “to consolidate the gains” of the structural reforms the current government has undertaken.

“It is not a populist budget, but a popular one because it blends both economy and politics,” he said in an interview. Enumerating the political concerns that the government needs to address through the budget, Jaitley listed “consolidating all the gains” of this government such as “effective leadership”, an “honest government” and the “changes brought about for the betterment of the country”.

“We also need to ensure that even though there is a high acceptability of the central government and the Prime Minister, we don’t allow any anti-incumbency of any of our state governments,” he explained.

Eight states go to the polls this year, and the parliamentary elections are scheduled for next year. The BJP is already in power in several of the states that will see elections in 2018. Staying on the theme, Jaitley said the “farm crisis” and “jobs” are both important issues and that he is “looking at the next year as a period of consolidation where both get addressed.”

As for the middle class, Jaitley suggested that there is enough for it in this budget too.

“There is not a single budget of mine in which the middle class has not got some relief,” he said. “Anything in the range of ₹10,000 crore plus-minus is the relief I have given in each of my budgets to the middle and lower segments of the salaried class. Even in this budget I have given a ₹8,000 crore relief to the salaried class and a ₹4,000 crore relief to senior citizens.”

The tax is also something the middleandhigherincomegroups should not mind paying, according to the finance minister. “If you run massive social security schemes, a 1% cess – it is not a 1% tax – is a small contribution that people with middle or higher incomes can afford.”