Karnataka - Mysore   

Tax on cooperative banks resented

Staff Correspondent

MYSORE: The Forum of Urban Cooperative Banks has expressed dismay over the tax on income on urban cooperative banks levied in the Union Budget for 2006-07.

In a release, the forum said cooperative banks were exempted from paying tax as they catered to middle- and low-income groups. They do not enjoy a level-playing field with commercial banks and lack freedom to invest surplus income.

The forum pointed out that even while advancing loans, 60 per cent of the amount has to be earmarked for the priority sector.

It expressed fears that taxing the income of the banks will harm their interests.

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