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Arun Jaitley, under attack by Yashwant Sinha, to speak at Harvard on India’s tax reform

It’s the season. Less than a month after Rahul Gandhi’s US tour where he spoke to students in UC Berkeley and Princeton, India’s finance minister Arun Jaitley will be swinging by to speak at the prestigious Harvard University in Boston on October 11, 2017 before he heads to Washington D.C for the annual IMF Fall meetings.

“Mr Jaitley will be speaking on India’s tax reform”, a Harvard South Asia Institute staffer familiar with the event confirmed to Firstpost.

Jaitley has come under attack from an elder within his own party BJP in recent weeks. "A badly conceived and poorly implemented GST has played havoc with businesses and sunk many of them, and countless millions have lost their jobs, with hardly any new opportunities coming the way of the new entrants to the labour market,” former finance minister Yashwant Sinha wrote last week in The Indian Express.

Union Finance Minister Arun Jaitley. PTI

Union Finance Minister Arun Jaitley. PTI

Yashwant Sinha wrote this column on September 27, setting off fireworks. Headlined “I need to speak up now”, Sinha’s biting criticism of Jaitley begins by saying that Jaitley has made a “mess” of the economy.

"Probably, a more appropriate title for the book would have been 'India @70, Modi @3.5 and a job applicant @ 80," Jaitley hit back, in a not so veiled reference to Sinha while speaking at a book launch the same week.

Non-fans of GST say many of GST’s advantages are nullified by the administrative burden placed on businesses buying from suppliers who are exempt from paying GST. The onus is on the buyer who has to file all related documentation on behalf of the supplier to get the input tax credit.

Last week, Jaitley indicated that the government would consider reducing the goods and services tax slabs and easing compliance burden for small taxpayers once revenues from GST better those from the previous tax regime.

The GST has four slabs — 5%, 12%, 18% and 28% — plus zero tax for exempted goods and an additional GST compensation cess levied on certain products above the basic slab.

Jaitley’s comments come against the backdrop of growing criticism of the early impact that the GST rollout has had on businesses, especially those in the small and medium segment.

Also, chief of the RSS, Mohan Bhagwat belted out his most political speech yet on Vijayadashmi day last weekend, clearly signaling that the party's core base - lower middle classes, traders, SMEs and others in the informal sector are being hurt, post demonetization and GST roll out. Here is an excerpt from that speech: "Like Jan Dhan, MUDRA, Gas Subsidy, agricultural insurance etc and some bold decisions are taken at the government level. Yet, the requirement of an integrated and holistic policy, which will take into consideration the diversity and various requirements of the nation; will address the needs of industry, trade, agriculture and environment together, will safeguard the interests of all from big, medium and small industries, to small retailers, farmers and landless labours, is very much felt. The compulsion to move on the currently accepted global policies and standards, even if they are faulty, artificial, create a mirage of prosperity, cause erosion of morality, environment, employment and self-reliance; can be understood to a certain extent. However it is also universally being recognised that all these policies and standards need a rethinking and nation specific unique models of development should evolve."

Jaitley said recently that veteran BJP leader L K Advani had advised him to always speak on issues and not about people but whether Jaitley speaks on the economy or people or the Modi government, the lane markers have shifted significantly since he was here last. GDP growth projections have gone south and businesses are taking GST fallout on the chin. Modi’s shock move to demonetise the lion’s share of India’s currency one night in November 2016 and the unified indirect tax GST both were yet to happen last Fall when Jaitley was in the US.

“I must confess that I do not have the luxury as yet of being a former finance minister; nor do I have the luxury of being a former finance minister who’s turned columnist. Therefore, I can conveniently forget a policy paralysis, I can conveniently forget the 15% NPAs (non-performing assets) of 1998-2002, I can conveniently forget the $4 billion forex reserves left in 1991 and I can switch over and change the narrative,” Jaitley said without explicitly calling out Sinha’s article.

Jaitley is set to deliver the annual Mahindra Lecture at the South Asia Institute in Harvard. The setting will be similar to the Princeton event of Rahul Gandhi with a sit-down capacity of 100 people on location inside Harvard University.

The annual Mahindra lecture is delivered in honor of the late Harish C. Mahindra, a Harvard alum.  His son, Anand Mahindra ’77, MBA ’81 has given Harvard University $10 million in 2010.

In the history of Harvard’s South Asia Institute, Arun Jaitley is only the second Finance Minister of India to deliver the Mahindra Lecture. P Chidambaram spoke in 2007 on the theme - Poor rich country - the challenges of development.

TM Krishna delivered last year’s lecture and the last ‘political’ personality who spoke at the event was APJ Abdul Kalam. In 2014, Nandan Nilekani spoke on Aadhaar.

Updated Date: Oct 03, 2017 22:23 PM

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