Taxing farmers was always seen as the trademark of colonial oppression and after independence, India decided not to tax agricultural income. In the period between 2007-08 and 2015-16, an estimated 2,746 entities and individuals each declared agricultural income of at least Rs1 crore. According to government estimates, of the 250 million households in the country, around 150 million are agricultural households, which means the government has to target the remaining 100 million households to increase the taxpayer base. Jaitley, in his budget speech, pointed out that India is largely a tax non-compliant society. In a debate in Parliament last year, when some Members of Parliament belonging to the Biju Janata Dal and Trinamool Congress had raised the issue of big companies earning crores in tax exempt agricultural income, the finance minister firmly stated that the government has no plans to tax agricultural income.

Source: Mint February 01, 2017 20:26 UTC