The Union Budget proposed by Finance Minister Arun Jaitley looks to clean and reform the political funding system.
Jaitley, in his third budget, proposed to restrict cash donations to political parties from individuals to just ₹ 2,000. Not just that, it also proposed the introduction of ‘electoral bonds’ that can be redeemed by recognised political parties within a prescribed time limit. These bonds can be issued by notified banks.
“In accordance with the suggestion made by the Election Commission, the maximum amount of cash donation that a political party can receive will be Rs 2,000 from one person. Political parties will be entitled to receive donations by cheque or digital mode from their donors,” Jaitley said while reading out the Budget for 2017-18.
Besides, the Budget proposed an amendment to the Reserve Bank of India Act to enable the issuance of electoral bonds in accordance with a scheme that the government would frame in this regard.
“Under the scheme, a donor could purchase bonds from authorised banks against cheque and digital payments only. They shall be redeemable only in the designated account of a registered political party. These bonds will be redeemable within the prescribed time limit from issuance of bond,” Jaitley said.
In line with the government’s attempt to crackdown on black money, political parties will have to file returns and they can disclose the number of bonds in their income tax returns.
“Bonds will be bought through cheque and bonds will be encashed with banks. It will be clean money and …transparent, as the buyer is known,” Jaitley said.
(With inputs from PTI)