Arun Jaitley

New Delhi, (IANS) : The government has no plans to impose any tax on agricultural income, Finance Minister Arun Jaitley said on Wednesday, putting to rest recent speculations on a politically sensitive issue.

“I categorically state that the Central government has no plan to impose any tax on agriculture income,” Jaitley said in a tweet, clarifying that the Centre has no constitutional authority to tax agricultural income.

Talking to reporters here on Tuesday, Niti Aayog member Bibek Debroy had said that taxes should be imposed on agricultural income above a certain threshold in order to expand the tax base.

“The eventual answer to expanding the tax base is to tax the rural sector, including agricultural income above a certain threshold,” he had said.

“While only the agricultural income of farmers is exempt from taxation, their non-agricultural income also goes un-taxed.”

“I don’t believe in the artificial rural-urban distinctions. So whatever is the threshold of personal income tax in urban areas should be for the rural areas as well,” Debroy added.

The NITI Aayog, in a statement on Wednesday, said Debroy’s suggestion is neither the view of the Aayog “nor is such a recommendation made anywhere in the Draft Action Agenda document as circulated to the Governing Council at the meeting on 23rd April 2017”.

“NITI Aayog notes that the views on taxing farm income expressed by Member Bibek Debroy were personal and not those of the Aayog,” it added.

Replying to the debate on the Finance Bill 2017-18 in the Lok Sabha last month, Jaitley had said there will be no tax on farm income.

“Income from agriculture will not be taxed,” he had said.