May support Congress if it accepts banking transaction tax, says Ramdev

New Delhi: Yoga guru Ramdev said he may support the Congress in the upcoming Lok Sabha elections provided the party supports his proposal to replace all taxes with single tax on banking transactions.

"If Congress accepts our proposal of single window taxation and single tax we will support it... We give the Congress support but first they take initiative," Ramdev said on the sidelines of a conference organised by The Institute of Chartered Accountants of India (ICAI).

Ramdev has proposed a single Banking Transaction Tax (BTT) to replace all direct and indirect taxes. "Country is presently under economic anarchism and tax terrorism, this banking transaction tax (BTT) is a solution to all these problems," he said.

Brushing aside the criticism, he said, the new taxation which is based on a banking transactions is equitable and would be made a big issue in Lok Sabha polls.

"The alternative tax regime could bring prices of LPG cylinder and petrol substantially down as heavy taxes are levied on these items," Ramdev said.

Once fully implemented, the proposed system would generate more than Rs 40 lakh crore per annum for the exchequer as against about Rs 10 lakh presently, he claimed.

The components of the new taxation structure include five to seven slabs of BTT ranging from 0.10 per cent to 30 per cent; demonetisation of the currency notes of Rs 500 and Rs 1,000 and just distribution of tax proceeds to centre, states and local bodies.

In the new scheme of things banking transaction tax would be levied on receiving transaction at different slabs on manufacturers of goods, service providers and traders, Ramdev said.

He also claimed that with the implementation of this proposed tax structure the whole movement of money in the economy could be traceable.

However, Ramdev added he has talked about it with BJP President Rajnath Singh, and former BJP president Nitin Gadkari and they were supportive.

The money provided to the banks could be used for expanding the banking network in the country, he said, adding, such a step would help in promoting financial inclusion.