Finance Minister Nirmala Sitharaman on Friday asked tax officials to redefine their approach to taxpayers and be more responsive, responsive, agile and responsible in building a 21st century India.
Speaking after inaugurating the new CGST Bhawan in Ghaziabad, the minister told the Indirect Tax Administration officials that a new mindset was needed and urged them not to adopt the mindset of pre-GST or the first generation of GST and instead look at India in the 21st century. Officials must address “the urgent need for our cooperation so that India can be a developed country by 2047,” she said, adding that a lax approach would not help the country.
Sitharaman’s message reflects the government’s drive to make the investment climate more attractive, as a strong recovery in private investment on the back of strong capital spending by the Center could add further impetus to economic growth and job creation. The government has been consistently signaling officials to ensure that tax administration should be based on trust and the regulatory framework should be light.
Sitharaman also told the officials to be consistently proactive. “Redefine how you deal with taxpayers, (you) should be more responsive, more facilitating and more responsible.” This is in line with the next generation of GST reforms, which the minister said must be felt differently by the taxpayer.
“They should feel that they are treated with honor because they are the taxpayers of the nation. If there are bad sheep among the taxpayers, follow the protocol to catch them. But don’t look at everyone with suspicion,” the minister told officials of the Central Board of Indirect Taxes and Customs (CBIC).
The statement signals the idea that the tax framework should be designed to facilitate the honest majority, rather than being complex and prescriptive to prevent every conceivable violation.
The minister said that from November 1, the simpler GST registration scheme will allow automatic registration within three working days in two cases – applicants identified by the system based on data analysis and those who self-assess that their tax liability will not exceed ₹2.5 million per month.
The reform is expected to benefit 96% of new applicants, Sitharaman said. She also said that GST Help Centers across the country should be well staffed, accessible and well maintained so that taxpayers get timely and quality assistance.
On September 22, the central and state governments introduced sharp cuts in GST rates in a bid to give the economy a boost to consumption. Citing data from the Confederation of All India Traders (CAIT), the Minister said festive retail sales reached an all-time high. ₹6.05 trillion this year, a 25% increase over last year’s Diwali sales of approx. ₹4.25 trillion. From the total number of approx ₹5.40 trillion was spent on goods and ₹65,000 crore on services, making it the biggest Diwali deal in the history of Indian trading, the minister said.
An official statement issued by the finance ministry said Sitharaman called for greater empathy, greater courtesy and greater integrity on the part of all tax officials.
The minister also said that the ultimate goal of the reforms is to make life easier for honest taxpayers and allow them to feel comfortable with any change in the existing legal framework.
