Finance Minister P Chidambaram has assured party MPs from the north that there will be no levy of wealth tax on agricultural land, Haryana Chief Minister Bhupinder Singh Hooda said today.

Hooda led a delegation of Congress MPs from Punjab, Haryana, Rajasthan and Uttar Pradesh to the Finance Minister seeking his intervention on the issue of proposed imposition of wealth tax on agricultural land.

"The Finance Minister has assured us that there will be no levy of wealth tax on agricultural land and we are satisfied with his assurance," Hooda told reporters after meeting Chidambaram. He said that the confusion over wealth tax on agriculture has been clarified.

"We said that wealth tax should not be levied on agricultural land. Chidambaram has assured that the UPA government has a policy that there will not be any wealth tax on agricultural land."

Hooda said the Finance Minister will bring suitable amendments in Parliament. "He has assured that UPA has a policy that there will not be any wealth tax on agricultural land," the Haryana Chief Minister said.

Hooda along with Punjab Congress President Pratap Singh Bajwa and some party MPs had earlier met Congress President Sonia Gandhi in Parliament House over the issue.

While thanking the Finance Minister for his assurance, Hooda also thanked Prime MinisterManmohan Singh and Congress President Sonia Gandhi for their intervention on the issue.

Bajwa said, "Farmers were very emotional over the issue. The UPA has fulfilled its commitment that wealth tax will not be levied on agricultural land." He also appealed to the Akali leadership in Punjab to cancel their proposed dharnas and protests against the proposal. "Your attempts to misguide people is now has been proven wrong," he said.

The proposed amendment as contained in Finance Bill, 2013 seeks to impose a one per cent wealth tax on agricultural land.

Union Ministers Preneet Kaur and Manish Tewari were also part of the delegation that submitted a representation in which the Finance Minister was urged to "intervene and direct for withdrawal of proposed amendment and issue clarification to effect that urban land does not include agricultural land and no wealth tax is liable to be paid."

Hooda said Chidambaram reiterated that the UPA government has a policy to protect the interests of farmers and therefore, nothing would be done against the interests of the farmers. And if necessary, due procedure would be adopted so that no wealth tax is imposed on agricultural land, he quoted the Finance Minister as saying.

The wealth tax issue has snowballed in both Punjab and Haryana as ruling Shiromani Akali Dal in Punjab and Indian National Lok Dal, the opposition party in Haryana, have voiced strong reservations against the proposal under which wealth tax will be levied on farmers whose land falls within 8 km radius of municipal limits.

SAD and BJP have announced state-wide dharnas and protests on the issue on May 2 in Punjab.
Meanwhile, BJP MP Yaswant Sinha also raised this issue through a letter to Finance Minister P Chidambaram. He expressed concern over imposition of wealth tax on farmers whose land falls within a municipal area and suggested that this "wrong" be undone by incorporating an amendment to the Finance Bill. 

Sinha requested Chidambaram to move an "urgent amendment" to the Finance Bill - which will come up for discussion and passage in Lok Sabha tomorrow - and undo the "wrong to the agriculturists with retrospective effect". The former Finance Minister's contention is that agricultural land falling within a municipality is being subjected to wealth tax. 

"The matter has now assumed alarming proportions as tax officials are approaching agriculturists whose land unfortunately falls within the jurisdiction of a municipality," Sinha said. 

He maintained that as urbanisation grows, more and more areas are being declared as municipalities and poor farmers whose land falls within the municipality or within an area which is not more than eight kms from the local limits of the municipality are being increasingly subjected to wealth tax. 

Demanding that the matter calls for an urgent review, Sinha said in Punjab alone many agricultural lands have been attached by tax officials for non-payment of wealth tax. Sinha referred to a question raised by Naresh Gujral (SAD) in Rajya Sabha on April 22 on this issue. (Economic Times)