GST rates can be reduced further as tax base increases: Finance Secretary
Jul 23, 2020
- Economy is coming back on track sooner than what was being anticipated
NEW DELHI, 23 July 2020: Dr Ajay Bhushan Pandey, Finance Secretary, Ministry of Finance, Govt of India, today said that GST rates can be reduced further if the tax base increases. "Once the tax base increases, if we are able to enforce our tax laws, and everyone pays taxes properly there will be definitely scope for further reduction of taxes," he said.
Addressing a session on 'Digitization in Governance' at CAPAM 2020, Dr Pandey said, "We are quite aware of this and we are undertaking the exercise. The ultimate aim should be that we collect minimum taxes at minimum rates. Government should collect taxes which are absolutely necessary and to that extent we need to increase our tax base."
Dr Pandey further said that Government is also working on reducing the number of forms under the GST. He said that there were 495 forms in the pre-GST era with 17 different taxes which were levied by various states. 'After the introduction of GST, the number of forms has have reduced to 17-18 and we want to further cut down the number of forms in GST."
He added that with IT-enabled platforms, there is no inspector raj now, and GST regime has become faceless.
Elaborating on the new measures undertaken for income tax assessment, including the faceless assessment of taxpayers, he said that the Government is working on promoting self-compliance. He added that Government is also working on providing full tax profile for each taxpayer. "We have all the information and if it can be shared in a secure manner, protecting the privacy of the individual, this will help also help in securing loans from banks. The entire digital exercise is being undertaken across various government departments. We are making all that information available and providing it to each taxpayer," added Dr Pandey.
He also said that all the information is getting integrated for the benefit of the citizens, including ease of doing business, ease of living and is also enhancing our capabilities.
Stressing on the importance of digitization, Dr Pandey said that India is the only country to have Aadhaar, Aadhaar-enabled payment system, direct benefit transfer scheme and UPI payment scheme. "Use of digitization in governance has improved our speed, effectiveness, efficiency and capabilities," he added.
Dr Pandey noted that in last 3 months, the total Aadhaar-enabled transaction has crossed Rs. 50,000 crore and UPI transaction has taken over debit card transaction and cash withdrawals. Highlighting the revenue trend and the potential of the Indian economy, Dr Pandey said, "All figures are giving an encouraging signal that the economy is coming back on track sooner than what was being anticipated when the lockdown started."
Dr Sangita Reddy, President, FICCI said that digital has become the new norm in the post COVID-19 world. COVID-19 has disrupted the global economic growth, but one of the blessings in disguise has been the boom in digitization. "It is time to unleash digital reforms even further and leverage the efficiency gains through digital adoption for reviving and accelerating India's economic growth. Let us collectively believe in the power of India," she added.
Mr Sunil Sanghai, Chairman, FICCI National Committee on Capital Markets said digitization is not only going to improve the governance but will also reduce the cost of governance.
FICCI MEDIA DIVISION