Tax Evasion by Legislators Under FGG Lens
The FGG also questioned the government’s decision to accord minister rank to three of the six whips appointed recently, each drawing close to Rs 4 lakh.
Hyderabad:Legislators in Telangana are showing a salary of only Rs 20,000 to evade income-tax, despite receiving monthly payments ranging between Rs 2.5 lakh and Rs 3 lakh. The Forum for Good Governance (FGG) has questioned the continued provision that allows public representatives to treat the bulk of their pay as tax‑free allowances. The FGG also questioned the government’s decision to accord minister rank to three of the six whips appointed recently, each drawing close to Rs 4 lakh. These individuals too show only Rs 20,000 as salary, thereby avoiding tax.
The forum pointed out that even the Chairman of the Legislative Council drew a monthly take‑home of Rs 4,11,000 but paid no income-tax, as only Rs 41,000 was shown as salary and the rest as allowances. “This type of arrangement is only for evading income-tax,” the forum said. It cited sub‑section (4) of section 3 of the Payment of Salaries Act, 1953, under which the state government bears the tax liability of the Chief Minister, Deputy Chief Minister and other ministers. The forum argued that the provision violated Article 14 of the Constitution and noted that many states have scrapped it, while Telangana continues to follow it.
The forum demanded that the government scrap sub‑section (4) of section 3 of the Act, adopt the policy of appointing only one whip per party, and streamline heads of account so that legislators become income tax payers.