Farmers to face double whammy: Land grabbing and Income Tax : Bajwa

Farmers to face double whammy: Land grabbing and Income Tax : Bajwa 

IT implications on pooled land to place a heavy financial burden on landowners : Bajwa. 

Chandigarh 1 August ( Ranjeet Singh Dhaliwal ) : Highlighting a critical flaw in the Aam Aadmi Party-led Punjab government's Land Pooling Policy, Leader of the Opposition (LoP) in the Punjab Assembly, Partap Singh Bajwa, on Friday, firmly stated that Income Tax (IT) implications will apply to the pooled land, imposing a substantial financial burden on landowners. This directly undermines the government's narrative that the policy is entirely beneficial and farmer-friendly. "Urban agricultural land is unequivocally recognized as a capital asset under the Income Tax Act, meaning that any profits from its sale are subject to taxation. However, land acquired under The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, is exempt from this taxation. Since the current acquisition is occurring under the 1995 legislation, the Income Tax rules will be enforced accordingly," asserted Bajwa. Senior Congress Leader Bajwa stated that agricultural land under a Municipal Committee/Corporation jurisdiction will be classified as urban agricultural land based on population size. For towns/cities with populations of 10,000 to 1 lakh, land within the MC or 2 kilometres beyond is considered urban. For populations from 1 lakh to 10 lakh, the boundary extends to 6 kilometres, and for those over 10 lakh, it extends to 8 kilometres. "When the owner of the land receives the Sahuliyat Certificate—a crucial document for those participating in the land pooling scheme—the income tax implications will come into effect. Landowners must pay a 12.5 percent income tax on the difference between the collector rate as of April 1, 2001, and the current collector rate for their specific area," Bajwa asserted. Bajwa also stated that the government has been acquiring land surrounding municipalities like Ludhiana, Samrala, and Mohali. Therefore, landowners will be required to settle their income tax obligations before July 31, 2026.