New Delhi: The BJP (Bharatiya Janata Party) is likely to oppose the contentious tax reform proposals to reduce and eliminate incentives for housing, small savings and standard deductions pitting Finance Minister Jaswant Singh against his advisor Vijay Kelkar, who headed the committee on taxes that gave its report last week.

The party general secretary Rajnath Singh has convened a meeting of his committee on January 5 to finalise the response to the Kelkar panel recommendations with some of the "anti-middle class" proposals not finding favour with party functionaries.

"It is a mistake to have appointed Kelkar to head the panel," a party functionary said on condition of anonymity.

"The party will demand that the tax break of upto Rs 1.5 lakh interest on housing loans be retained along with standard deductions and incentives for small savings," he said adding BJP was in favour of doubling Income Tax exemption limit to Rs one Lakh as the party manifesto had advocated it three years ago.

While the party favoured most of the proposals in indirect taxes including lowering of customs and excise rates, it was against the proposals to remove the cess on petrol and diesel saying the cess had helped a great deal in mobilising resources for the ambitious Highway project of the Prime Minister Atal Behari Vajpayee.

PTI