Inheritance tax will impact India's middle class: Finance Minister Nirmala Sitharaman

Union Finance Minister Nirmala Sitharaman has criticised Congress for allegedly planning to bring back inheritance tax if voted to power. This comes amid the ongoing debate over inheritance tax after Chairman of the Indian Overseas Congress Sam Pitroda highlighted the importance of wealth distribution.

Meanwhile, Congress has consistently denied allegations that it would bring in inheritance tax and said that it was never mentioned in its manifesto.

Finance Minister on Inheritance Tax

While casting her vote at a polling booth in Bengaluru, Sitharaman claimed that the inheritance tax would directly impact India's middle and aspirational class. She further added that it would erase the advancements made by India in the past decade.

"I remember earlier in 1968 there was a compulsory deposit scheme where people's deposits were all 18 per cent, 20 per cent. Something was taken away. There was no justification given at that time... If such wealth creators are going to be punished purely because they have some money kept behind, India's progress in the last ten years would just go for a zero. And we'll probably be going back to that era when Congress imposed a 90 per cent tax. You'll probably not believe that the current generation, wouldn't even remember or know anything about it. There was India where under the Congress rule we paid 90% of all that was earned by us as tax. That's the socialist model which the Congress party is comfortable with", said Nirmala Sitharaman.

She insisted that the inheritance tax will directly impact the savings and properties earned during their lifetime.

"It (the inheritance tax) directly hits the middle class. It directly hits the aspirational class. They work hard, sweat and toil of theirs are saved in small savings here and there, or they buy a house, a dream house, and keep some fixed deposits. All this is going to be exposed to the so-called property tax," she said.

Inheritance Tax

Inheritance Tax is a levy imposed on the transfer of assets from deceased persons to their beneficiaries. This has been implemented in various countries as a means to redistribute wealth and promote economic equality.

Also Watch: Old video of Nikhil Kamath supporting inheritance tax goes viral