This is NOT about the latest budget presented by Mrs. Nirmala Sitharaman or its analysis but a tongue in cheek journey down memory lane.
Flashback to almost 50 years and I remember the mood in the house on budget day. It was invariably 28th Feb and the speech would start late evening. There would be deathly silence around the house as father sat in front of the Radio, with a notebook and pen in hand to write down important points and everybody asked not to make any noise lest he miss some important word.
There would be a medley of his government car, jeep, truck drivers also waiting outside. Before you wonder why, budgets often announced increases in petrol/diesel prices and then he would gesture – go, go, go – and the drivers would all drive in a frenzy to the authorised fuel pumps with the “stock book” signed by father. All vehicles would be filled up with fuel to the full. Sometimes I would be asked to go and help in this task to check the quantity of fuel filled.
The reason was the price increase would kick in at midnight that day and soon everybody who had a vehicle in the town would be at the fuel station filling up to save a few measly rupees. This so called measly savings were so significant that more than one government department did this (let alone the rich common man with a scooter) because this helped them save money in their budgets. Today this will look ridiculously stupid but in those days it literally meant an extra day or two of expenses covered. A 100 Rs saved was a kings ransom.
Projects and their budgets would be announced (with a separate Railway budget actually) and if the announcement did not talk of any money allotted to a project father was involved in, he would be in deep despair because that meant he may have to work without being paid a salary or earn salary against accumulated vacation days or such. This would be till such time his seniors fought for funds to be granted at least for salaries for those projects.
The other aspect was the annual change in income tax rules, rates, that were rather significant. Based on how it affected you, the mood in the house would change. But then those were the days when toothpaste, soap, (shampoo? what shampoo???) and talcum powder were taxed to death because these were middle class luxuries. Yes, luxuries.
One budget of Charan Singh resulted in family switching from toothpaste to tooth powder (which was considered the poor mans option) and going back to using the finger for brushing teeth. The tooth brush lasted us for god knows how many months till the damn thing looked like it had been bombed
As we listened to the radio we also waited with bated breath to hear if the radio license fee was increased. We had a radio license passbook and we paid fees every year – to be allowed to own and listen to the radio. For the younger reader – I am NOT making this up.
The so called richer folks had to contend with higher taxes on stuff like TV, Refrigerator and such stuff which today are a necessity. Even as late as 1973/74 or so I still recall in a town called Guntakal where we stayed, during peak summer I would go running to a colleague of father who had a fridge to get some ice cubes once in a while to cool off. Hell, we did not even get cauliflower those days and a colleague who visited Delhi would bring back a few for the rest to share and enjoy – just a few pieces. When we finally got a fridge – still recall it was from Voltas – father was “allotted” one and it was sent from Madras (now Chennai) by train and the whole neighbourhood joined in to enjoy cool drinks. If the taxes on fridges went up the next year we would actually thank god for our luck.
Another thing was the bonus announced. Ever since I can remember – whatever the interest rates, even if they were 18% – the bonus rate was 8.33% – one months salary. Strikes, protests and what have you would happen if this was disturbed. This was like the ultimate nirvana for the working class.
If the budget gave out income tax rate cuts or reduced taxes on toothpaste, soap, shampoo etc the budget was hailed as a middle class budget. Everybody focussed on the so called middle class. Why ?
The so called middle class were actually as poor as the barn rat but did not actually starve. By focussing on them – since the nation only had 2 classes – the rich and the rest 99% poor – the governments created a brand equity called middle class. Just to make some people feel they were better off. This branding was the biggest con game pulled off by governments because the middle class paid income tax, got little except that they could also enjoy the infrastructure created in the country. Today of course one can see various classes of people and if you are not classified as rich (HNI) or poor, you become middle class. Its like a no-mans land.
For the more intellectual minded the key figure in any budget was the Deficit – because that meant the govt would need to print that much currency to make up the shortfall between revenue and expenditure. When you read an headline that says Rs. 1235 Cr deficit of the whole nation over one year and today read about the corruption scams, you begin to wonder. Given the kind of money looted in ONE scam, hell, the chap could have purchased the India of the old itself.
These budgets were so complex to understand that even the high and mighty of the business world gathered in a plush auditorium to hear the legendary Nani Palkhivala decode the budget for them.
Budgets also spoke about licensing or other import/export related regulations and this could mean the difference between success and failure for many. With time, as I grew up, sometime in the early 90’s I started listening to it myself since it impacted my own work due to excise duty etc.
One budget of PV Narasimha Rao/ Manmohan Singh in 1991 disrupted the budgetary process because it did what nobody had ever done – threw out all licences, reduced all taxes/duties, removed many regulations, etc.
This was like a horde of circus animals ranging from Elephants to Lions to Tigers to the Dogs and Ducks being released from their cages and all of them now having to find a home, food and be on their own. There was literally mayhem and chaos because the gaping visitors at this Indian zoo (meaning those who enjoyed power due to the licence raj) with their popcorns and champagne were running for life but the animals did not eat each other but instead started running free and happy. This changed the entire sanctity of the budget itself and in recent times some minor but yet important changes were brought in to further demystify the images evoked.
These were:
- The Railways budget was abolished – very rightfully
- The finance minister no longer walked in with a maroon briefcase and team while trucks unloaded the budget papers.
- The budget is read from a laptop/tablet and the members get the papers by email.
- The budget is presented on 1st Feb and takes effect from 1st April.
The ONE thing that has not changed even one bit, since the last 40 years at least if not more, and if collated would finally end up as a dozen phrases or so are the comments that the opposition and critics of the Government make when responding to the budget. Some are Anti Poor, Anti farmer, Pro rich, Lacking in vision, Lacks imagination, No reforms, Anti people, Nothing new, Agriculture neglected, No employment, Lacks direction, Inflationary, Anti Growth You can use these to any budget by anybody in any country and in fact you can say this even before the budget is presented and you could still claim to be correct after the budget is presented.
Author: Ravindra Vasisht can be reached on Twitter: @rvasisht
Article republished with permission from Author.
Original Source: http://rvasisht.blogspot.com/2023/02/budget-memories.html
