Lok Sabha passes Finance Bill sans Rajya Sabha amendments

The Lok Sabha on Thursday passed the Finance Bill 2017 sans the five amendments recommended by the Rajya Sabha. The Budget exercise for 2017-18 is now complete with Parliament's seal of approval for the Finance Bill 2017.

The upper house had recommended curbing unbridled powers to taxmen, and reintroducing limits on corporate funding of political parties as well as disclosures of political funding.

The Finance Bill 2017, which was passed by a voice vote, will now go to President Pranab Mukherjee for his assent.

Lok Sabha's rejection of Rajya Sabha amendments to the Finance Bill would mean that the government's recent move to remove the existing cap of 7.5 per cent of net profit of last three financial years on donation by companies to political parties would get enacted into law.

Also, corporates would not be required to disclose in their financial statements the name of the political party receiving the contributions from them. The Rajya Sabha's recommendation requiring the disclosure of the name of the political party was also not accepted by the Lower House.

The Finance Bill 2017-18 attempts to make electoral funding more clean and transparent. Besides introducing the concept of electoral bonds, the Finance Bill 2017 provides a framework where donations to political parties could be made only through cheques or digital mode.

However, small cash donations up to Rs2,000 are being permitted.

Finance minister Arun Jaitley defended the rejection of amendments recommended by the Rajya Sabha saying that it would have led to limiting the number of donors to political parties.

He said the government was open to suggestions from political parties, including the Congress and the BJD, to make electoral funding more clean and transparent.

''The harsh reality is we continue to do politics on the basis of undeclared money, because if we do it on the basis of declared money... somebody will write an editorial and will have a problem with every solution we offer,'' Jaitley said.

''I have an open invitation to all, please suggest to me a better system which will ensure clean money and transparency to the extent possible. I am yet to receive a single suggestion. I am only hearing adjectives like 'it must be clean', 'it must be transparent'. Please give me ideal combination of the two. We are willing to consider it. I will wait for a specific suggestion'' .

Jaitley said most of the donations that come to political parties now are from unclean money and there was complete non- transparency.

Lok Sabha did not also accept the taxation amendments recommended by the Rajya Sabha, especially the ones that sought to temper down the unbridled powers sought to be provided to the taxman during his search and seizure operations.

Defending the government's decision in keeping the ''satisfaction note'' away from the target of investigation, Jaitley said there was not a single instance since 1961 when a ''satisfaction note'' was ever revealed to a target of investigation.

''It would be disastrous to do that,'' he said. The Finance Bill provides that taxman is not obliged to share such ''satisfaction note'' - which is the basis on which search and survey operations are initiated - up to the level of Income Tax Appellate Tribunal.