Govt should come down hard on cronies, says Mohandas Pai

Mohandas Pai (photographed) wanted an honest and transparent Budget from the new government.

The chairman of Manipal Global Education Services was forthright when he said the government often forgets that its prime duty is to serve the people and not some sick public sector units.

A government’s job is to govern and not to run a business, Pai told rediff.com during an interview prior to the Budget.

Now that the Budget is over, does it satisfy him?

During an hour-long chat on rediff.com on Monday, Pai analysed the Budget presented by Finance Minister Arun Jaitley along with rediff.com readers.

Here is the transcript:

Chetan

MNREGA is the main cause of unending inflation in Food and vegetable prices and certain type of labour costs. How come. In urban areas too unneccesary work like relaying footpaths unnecessarily, opening and supposed cleaning of storm water drains which clog again in a few days time is taken up. Is there no cure for this?

Mohandas Pai

not true, small impact

Vijay Sahani

India's GDP growth rate has been revised to 6.9% from 5.5%. Are we following the China model of growth now?

Mohandas Pai

not yet

Rajesh Thondukulam

I am keen to understand the concept of monetizing gold jewellery as is mentioned in this budget. Suppose one has 500 g of gold jewellery, how is the valuation done and will there be a common yardstick for all banks to follow.

Mohandas Pai

pl wait for the scheme to be announced with details

Varun

Who need tax relief Coop-rates or individuals

Mohandas Pai individuals as they have suffered from 60% inflation over last 5 years

Varun

Dont you think service tax 14% will lead to higher cost of leaving

Mohandas Pai

yes true

sathish kumar

What is your opinion for MSME segment especially from financing front? Are you satisfied with the government steps towards it

Mohandas Pai

a start but not sure if this will work, SIDBI has not been such a great success

PUNIT PODDAR

Budget 2015: Complete Coverage

den y u were slamming the budget on TV...

Mohandas Pai

for 2 gaps, making retro tax prospective and not increasing the slabs but giving deductions

chiranjeevi seshu-babu-thota

pl tell details of exemptions under pension scheme .is this exemption in addition to the rs 1.50 lakhs

Mohandas Pai

yes 50000 rs more

Vijay Sahani

while in principle i think having a Monetary Policy committee is a very good idea, I fear that this govt. will subvert it by putting their men in it. The appointment of the members should be done in a professional manner. you views?

Mohandas Pai

Agree, never trust govt when they have discretion

True Patriot

Do you think that NREGA scheme to be revamped or dropped to plug the hole in fiscal deficit?

Mohandas Pai

it has its use, very political

Venkatesh

Is this Budget 2015-16 going towards achay din?

Mohandas Pai yes better days

True Patriot

What is your opinion on this years budget about allocation on healthcare?

Mohandas Pai

inadequate, a maintenance amount, we need more coverage not more AIIMS

True Patriot

Do you think the current budget's spending on Healthcare is sufficient?

Mohandas Pai

nope not adequate

Firoz Khan

Will the four mega power projects be initiated in the year 2015-16?

Budget 2015: Complete Coverage

Mohandas Pai

doubtful, too many approvals to get

Chetan

Are the announced measures for Bank Recapitalization suffcient. Your views on raising Deposit Insurance Limit to Rs. 10 Lakhs per account. Current limit of 1 lakh is a laughable pittance. Do we foresee a Greece/Cyprus like Bank Scenario in the future (bailins, haircuts etc.). There are moves to prevent premature closure of deposits - is this to prevent bank runs?

Mohandas Pai

not enough, NPA and Stressed assets are 12% of lending, needs drastic action, sale of enterprises by banks, not molly codling like now. woudl be good to have higher insurance. but no banking crisis in forseeable future

umar khan

how is SIDBI different from Mudra?

Mohandas Pai

well has not worked well

Rajan sha

What is single composite cap for Foreign Investment ?

Mohandas Pai

as per policy, 100%, 74% or 49% for various sectors, sum of FII and FDI

srivathsaa Infotech

Pai Sir The FM wants us to save to enjoy tax benefit, when cost of living itself is so high. How can a middle class man like us save ur comments

Mohandas Pai

very true, that is why I said increasing tax slab is better for us

Vijay Sahani

At best this budget will bring more FDI. It has still not solved the problems plaguing Indian industry. Red tapism, corruption, judicial delays, plethora of laws and compliances, etc.

Mohandas Pai

yup, much lip service, harassment on ground

SRIRAM SUBRAMANIAN

Would you recommend investing in NPS (Rs. 50000) under section 80CCD for a person in 30% tax bracket?

Mohandas Pai

depends on your age and need for cash to spend

Amol Dhurve

Is it possible for the Government to share central tax projections?

Mohandas Pai

yes, they should. in the US the General Accounting Office makes impact analysis and 10 year projections

pinak shah

Service Tax is 14 Or 16 and applicable immediately.

Mohandas Pai

14% but some at saying swatch bharat surcharge is there of 2% but FM has not confirmed

SAM JOHN

Income tax 30% > corporate tax 25% (Only in India)

Budget 2015: Complete Coverage

Mohandas Pai

not year, only after 4 more years. am sure they will reduce the individual top rate too, otherwise people will be upset

Satish Pulli

what is tax buoyancy? please explain and where does it apply?

Mohandas Pai

tax bouyancy is when tax collections increase higher than GDP rate because of growth and deepening of tax compiance

vudatala raja

NDA is working towards building a similar welfare state like the one envisioned by UPA - why then is this budget called path breaking?

Mohandas Pai

nope, subsidy is coming down as % of GDP, others are small amounts

jim david

from when increased service tax is applicable?

Mohandas Pai

they will announce the date, after the finance act is passed

Amol Dhurve

There were no changes in income tax slab? they could have done some changes right, your views?

Mohandas Pai

prefer an increase in slabs then deducations. Deducations benefit people over 40, slabs younger tax payers

Vijay Sahani

Govt should launch an e-auction site for property. People who sell / buy property through e-auction should be given rebate in stamp duty.

Mohandas Pai

good idea

SAM JOHN

I think India is the country where income tax is more than corporate tax...

Mohandas Pai

not true. C tax 4.26 lakh cr and income tax 2.78 lakh cr

Jim Vejvoda

Is this budget in anyways good for the IT sector?

Mohandas Pai 

not much. TDS on royalty and FTS reduced from 25 to 10%, was a big pain. 1000 cr start up fund.

SAM JOHN

earn less and pay more don't u think this is happening

Mohandas Pai

yes in real terms, inflation has been a killer

Gurshan Gurmeet

What is the new gold deposit scheme?

Mohandas Pai

no details yet

vijay

Can we expect from the government to promote economic growth in priority over fiscal deficit management?

Mohandas Pai

done

hardik

Will there be clarity in clarity on FDI and B2C e-commerce?

Mohandas Pai

nope only after GST

manali-sutar

What do you think will the Finance minister increase the Excise duty limit?

Mohandas Pai

GST hopefully

sanjay dwivedi

u tax me its ok, but who has given right to tax me for failur of PPP. jaitley says that majority risk in PP shall be absorbed by govt. so sad, this govt is in majority

Mohandas Pai

veru tru, govt should come down hard on cronies and not be soft on them

Savitha Patil

How will removal of wealth tax impact people who have taken loan on 2 houses in terms of it deduction

Mohandas Pai

no impact, deduction only for interest for SOP and for leased property

Patel

is it necessary pucharsed property to show letout property to claim income tax benefit on home loan and HRA on other rented premises

Mohandas Pai

pl ask your tax consultant

gopalakrishnan caruthedath

Don't you think that the successive governments have failed to realise the hardships of the senior citizens. Their tax free limit is still at 3 lac whereas there is a need for this to go up to 5 lac.

Mohandas Pai

true Govt needs to be generous to citizens in their old age

Prakash-Bedekar

BJP seem to have forgotten that they have been elected with the support of middle class and lower middle class people and sorry to say that they have been not only fooled but betrayed , please remember you will not be ruling India forever and will have face elections again

Mohandas Pai

yes tax proposals for middle class disapointing. better to increase slab

Mugada

There is an unreasonable high taxation on Auto sector, will it be reduced? Your views

Mohandas Pai

yes with GST rates will be rationalised

jitesh

Will the Budget 2015 – 16 be a major positive for the upstream oil firms?

Mohandas Pai

nope

rajat

Black money and domestic black money is an very important issues that ned s to be looked into, will the FM announce ant initiatives to put a stop Black money?

Mohandas Pai

true nothing in the budget to prevent this except the Benami Property act. He needs to make sale of real estate free of capital gains and sale of declared gold free of Cap gains too

shaishav

What will be the Budget impact for iron and steel industry?

Mohandas Pai

good, customs duty increased to prevent dumping here, industry was in trouble

suman singh

Rs 8.5 lac crore agriculture credit limit will bring improvisation in irrigation & soil health,leading to increased production. Your views!!

Mohandas Pai

well good one but since it is only at around 4% lot of misuse is there. People are reportedly lending it out to others at high interest, sharing with others

sonia agarwal

What happened to "One Rank One Pension?

Mohandas Pai

stuck in the fight between defence and defence forces. very complex. a person retired as col 20 years at x salary, his salary depends on promotion earlier, difficult to compare to current salaries, need to find compromise

anita nambair

Nothing for science&technology, nothing for better teaching staff& research institutes. Forgot abt the demographic dividend?

Mohandas Pai

very true, very meagre allocations for this

anjali nair

Is this Budget assertive to needs of common man? will new proposals will accelerate pace of development putting India on higher growth trajectory?

Mohandas Pai

probably will, economy is looking better than last year

arup ratan sit

corporate tax is reduced, hence cirporate will benefit its employees and the imcome of the person will go up.now anybody has to work under a corporate.

Mohandas Pai

wrong. only in 2016-17 and that too from reduced exemptions, so no net benefit to corporate sector. Only corporates who do not have exemption will benefit. effective rate today is 23%

ramakrishna

Wealth tax abolished, who will benefit from this?

Mohandas Pai

very little benefit, collection only 1000 cr, the 2% surcharge on income above 1 cr is collecting 9000 cr. Fm has made people pay more in the name of abolishing WT

arup ratan sit

fighting for a cause and getting injured or marrying death should be covered under the Rs 12 insurance.in nearest Police station one should buy the ploicy before going for any demonstration.

Mohandas Pai

good idea

Chetan

MNREGA is the main cause of unending inflation in Food and vegetable prices and certain type of labour costs. How come. In urban areas too unneccesary work like relaying footpaths unnecessarily, opening and supposed cleaning of storm water drains which clog again in a few days time is taken up. Is there no cure for this?

Mohandas Pai

not true, small impact

Vijay Sahani

India's GDP growth rate has been revised to 6.9% from 5.5%. Are we following the China model of growth now?

Mohandas Pai

not yet

Rajesh Thondukulam

I am keen to understand the concept of monetizing gold jewellery as is mentioned in this budget. Suppose one has 500 g of gold jewellery, how is the valuation done and will there be a common yardstick for all banks to follow.

Mohandas Pai

pl wait for the scheme to be announced with details

Varun

Who need tax relief Coop-rates or individuals

Mohandas Pai individuals as they have suffered from 60% inflation over last 5 years

Varun

Dont you think service tax 14% will lead to higher cost of leaving

Mohandas Pai

yes true

sathish kumar

What is your opinion for MSME segment especially from financing front? Are you satisfied with the government steps towards it

Mohandas Pai

Budget 2015: Complete Coverage

a start but not sure if this will work, SIDBI has not been such a great success

PUNIT PODDAR

den y u were slamming the budget on TV...

Mohandas Pai

for 2 gaps, making retro tax prospective and not increasing the slabs but giving deductions

chiranjeevi seshu-babu-thota

pl tell details of exemptions under pension scheme .is this exemption in addition to the rs 1.50 lakhs

Mohandas Pai

yes 50000 rs more

Vijay Sahani

while in principle i think having a Monetary Policy committee is a very good idea, I fear that this govt. will subvert it by putting their men in it. The appointment of the members should be done in a professional manner. you views?

Mohandas Pai

Agree, never trust govt when they have discretion

True Patriot

Do you think that NREGA scheme to be revamped or dropped to plug the hole in fiscal deficit?

Mohandas Pai

it has its use, very political

Venkatesh

Is this Budget 2015-16 going towards achay din?

Mohandas Pai yes better days

True Patriot

Budget 2015: Complete Coverage

What is your opinion on this years budget about allocation on healthcare?

Mohandas Pai

inadequate, a maintenance amount, we need more coverage not more AIIMS

True Patriot

Do you think the current budget's spending on Healthcare is sufficient?

Mohandas Pai

nope not adequate

Firoz Khan

Will the four mega power projects be initiated in the year 2015-16?

Mohandas Pai

doubtful, too many approvals to get

Chetan

Are the announced measures for Bank Recapitalization suffcient. Your views on raising Deposit Insurance Limit to Rs. 10 Lakhs per account. Current limit of 1 lakh is a laughable pittance. Do we foresee a Greece/Cyprus like Bank Scenario in the future (bailins, haircuts etc.). There are moves to prevent premature closure of deposits - is this to prevent bank runs?

Mohandas Pai

not enough, NPA and Stressed assets are 12% of lending, needs drastic action, sale of enterprises by banks, not molly codling like now. woudl be good to have higher insurance. but no banking crisis in forseeable future

umar khan

how is SIDBI different from Mudra?

Mohandas Pai

well has not worked well

Rajan sha

What is single composite cap for Foreign Investment ?

Mohandas Pai

as per policy, 100%, 74% or 49% for various sectors, sum of FII and FDI

srivathsaa Infotech

Pai Sir The FM wants us to save to enjoy tax benefit, when cost of living itself is so high. How can a middle class man like us save ur comments

Mohandas Pai

very true, that is why I said increasing tax slab is better for us

Vijay Sahani

At best this budget will bring more FDI. It has still not solved the problems plaguing Indian industry. Red tapism, corruption, judicial delays, plethora of laws and compliances, etc.

Mohandas Pai

yup, much lip service, harassment on ground

SRIRAM SUBRAMANIAN

Would you recommend investing in NPS (Rs. 50000) under section 80CCD for a person in 30% tax bracket?

Mohandas Pai

depends on your age and need for cash to spend

Amol Dhurve

Is it possible for the Government to share central tax projections?

Mohandas Pai

yes, they should. in the US the General Accounting Office makes impact analysis and 10 year projections

pinak shah

Service Tax is 14 Or 16 and applicable immediately.

Mohandas Pai

14% but some at saying swatch bharat surcharge is there of 2% but FM has not confirmed

SAM JOHN

Income tax 30% > corporate tax 25% (Only in India)

Mohandas Pai

not year, only after 4 more years. am sure they will reduce the individual top rate too, otherwise people will be upset

Satish Pulli

what is tax buoyancy? please explain and where does it apply?

Budget 2015: Complete Coverage

Mohandas Pai

tax bouyancy is when tax collections increase higher than GDP rate because of growth and deepening of tax compiance

vudatala raja

NDA is working towards building a similar welfare state like the one envisioned by UPA - why then is this budget called path breaking?

Mohandas Pai

nope, subsidy is coming down as % of GDP, others are small amounts

jim david

from when increased service tax is applicable?

Mohandas Pai

they will announce the date, after the finance act is passed

Amol Dhurve

There were no changes in income tax slab? they could have done some changes right, your views?

Mohandas Pai

prefer an increase in slabs then deducations. Deducations benefit people over 40, slabs younger tax payers

Vijay Sahani

Govt should launch an e-auction site for property. People who sell / buy property through e-auction should be given rebate in stamp duty.

Mohandas Pai

good idea

SAM JOHN

I think India is the country where income tax is more than corporate tax...

Mohandas Pai

not true. C tax 4.26 lakh cr and income tax 2.78 lakh cr

Jim Vejvoda

Is this budget in anyways good for the IT sector?

Mohandas Pai 

not much. TDS on royalty and FTS reduced from 25 to 10%, was a big pain. 1000 cr start up fund.

SAM JOHN

earn less and pay more don't u think this is happening

Mohandas Pai

yes in real terms, inflation has been a killer

Gurshan Gurmeet

What is the new gold deposit scheme?

Mohandas Pai

no details yet

vijay

Can we expect from the government to promote economic growth in priority over fiscal deficit management?

Mohandas Pai

done

hardik

Will there be clarity in clarity on FDI and B2C e-commerce?

Mohandas Pai

nope only after GST

manali-sutar

What do you think will the Finance minister increase the Excise duty limit?

Mohandas Pai

GST hopefully

sanjay dwivedi

u tax me its ok, but who has given right to tax me for failur of PPP. jaitley says that majority risk in PP shall be absorbed by govt. so sad, this govt is in majority

Mohandas Pai

veru tru, govt should come down hard on cronies and not be soft on them

Savitha Patil

How will removal of wealth tax impact people who have taken loan on 2 houses in terms of it deduction

Mohandas Pai

no impact, deduction only for interest for SOP and for leased property

Patel

is it necessary pucharsed property to show letout property to claim income tax benefit on home loan and HRA on other rented premises

Mohandas Pai

pl ask your tax consultant

gopalakrishnan caruthedath

Don't you think that the successive governments have failed to realise the hardships of the senior citizens. Their tax free limit is still at 3 lac whereas there is a need for this to go up to 5 lac.

Mohandas Pai

true Govt needs to be generous to citizens in their old age

Prakash-Bedekar

BJP seem to have forgotten that they have been elected with the support of middle class and lower middle class people and sorry to say that they have been not only fooled but betrayed , please remember you will not be ruling India forever and will have face elections again

Mohandas Pai

yes tax proposals for middle class disapointing. better to increase slab

Mugada

There is an unreasonable high taxation on Auto sector, will it be reduced? Your views

Mohandas Pai

yes with GST rates will be rationalised

jitesh

Will the Budget 2015 – 16 be a major positive for the upstream oil firms?

Mohandas Pai

nope

rajat

Black money and domestic black money is an very important issues that ned s to be looked into, will the FM announce ant initiatives to put a stop Black money?

Mohandas Pai

true nothing in the budget to prevent this except the Benami Property act. He needs to make sale of real estate free of capital gains and sale of declared gold free of Cap gains too

shaishav

What will be the Budget impact for iron and steel industry?

Mohandas Pai

good, customs duty increased to prevent dumping here, industry was in trouble

suman singh

?8.5 lac crore agriculture credit limit will bring improvisation in irrigation & soil health,leading to increased production. Your views!!

Mohandas Pai

well good one but since it is only at around 4% lot of misuse is there. People are reportedly lending it out to others at high interest, sharing with others

sonia agarwal

What happened to "One Rank One Pension?

Mohandas Pai

stuck in the fight between defence and defence forces. very complex. a person retired as col 20 years at x salary, his salary depends on promotion earlier, difficult to compare to current salaries, need to find compromise

anita nambair

Nothing for science&technology, nothing for better teaching staff& research institutes. Forgot abt the demographic dividend?

Mohandas Pai

very true, very meagre allocations for this

anjali nair

Is this Budget assertive to needs of common man? will new proposals will accelerate pace of development putting India on higher growth trajectory?

Mohandas Pai

probably will, economy is looking better than last year

arup ratan sit

corporate tax is reduced, hence cirporate will benefit its employees and the imcome of the person will go up.now anybody has to work under a corporate.

Mohandas Pai

wrong. only in 2016-17 and that too from reduced exemptions, so no net benefit to corporate sector. Only corporates who do not have exemption will benefit. effective rate today is 23%

ramakrishna

Wealth tax abolished, who will benefit from this?

Mohandas Pai

very little benefit, collection only 1000 cr, the 2% surcharge on income above 1 cr is collecting 9000 cr. Fm has made people pay more in the name of abolishing WT

arup ratan sit

fighting for a cause and getting injured or marrying death should be covered under the Rs 12 insurance.in nearest Police station one should buy the ploicy before going for any demonstration.

Mohandas Pai

good idea

Budget 2015: Complete Coverage