Budget should exempt cooperatives from Income Tax: DN Thakur

Whatever profit cooperatives make gets distributed among its members. And any member who falls in the Income Tax (IT) bracket does pay taxes. So, cooperatives should be exempted from IT, said Dr DN Thakur, National President, Sahakar Bharati. He said that there should be a provision for exemption from taxes for cooperatives in the financial year 2023-24. It may be noted that the government has only recently announced the formation of three national-level cooperatives.

Speaking to Rural Voice, Dr Thakur said, “Business has three forms — public sector, corporate and cooperative. The relevance of cooperatives has increased today. It focuses on people, not on capital. So, the government should focus on improving their capacity-building, efficiency and management capacity. Instead of taking equity in cooperatives, the government should completely hand over the responsibility of their work to professionals.”

He said that cooperatives had strong roots in India. They are the most suitable institutions for food security and employment. Through adequate policies and incentives, the government should help farmers get organized as cooperatives. “Farmers should be encouraged to pool natural and economic resources so that these resources may be used effectively and sustainably, so that they may be conserved,” Dr Thakur added.

The government should focus on food management in the Budget through cooperatives, said Dr Thakur. This will save the government money and also involve people. Storage facilities may be developed in the village itself and connected through a national grid. For this, it is necessary that cooperatives be given cheap loans.