CB BureauThe Direct Taxes Code Bill, which is scheduled to replace
the Income Tax Act from April 1, 2012, proposes that charitable and
not-for-profit organizations (NGOs) will be allowed a basic exemption of only one
lakh rupees and any income over it will be liable to 15 per cent tax.
The bill also proposes to tax anonymous donations for NGOs
at the rate of 30 per cent as against the rate of 15 per cent applicable to
other donations. The 30 per cent tax will fall on the donations above one lakh rupees
or five per cent of total donations received by the NGO, whichever is higher.
At present, NGOs registered under certain sections of the
Income Tax Act get various kinds of tax concessions.
The NGOs have requested Finance Minister Pranab Mukherjee to
make modifications in the proposed bill. They say that taxes or exemptions
applicable to NGOs should be conditional on the assessment of their work.
The group, representing the NGOs, also demanded stringent
action against fake non-governmental organizations. The group said that it is because
of the unethical practices of the fake organizations that the government has to
enforce stringent laws and taxes, and they ultimately make the genuine NGOs suffer.
Swami Agnivesh from Bandhua Mukti Morcha (BMM), Swami
Atmapriyananda from Ram Krishan Mission and Namrata Bali from SEWA Academy,
among others, presented these demands to the finance minister.
NGOs also asked the minister to keep in mind the ‘green
energy’ options while drafting the budget. They said that nuclear energy is a
‘false solution’ while coal is a ‘dirty’ option.