Firming up GST roadmap vital for growth rebound
India must pay more attention to modernising its tax administration and look to broaden the tax base to increase its Central tax revenue to GDP ratio, Thomas Richardson, Senior Resident Representative, India and Nepal, International Monetary Fund, has suggested.
“There is a strong case for tax administration modernisation and easier payment of taxes. Broaden the tax net. The tax administration must also have customer service orientation,” Richardson said at an Assocham organised interactive session on expectations from the new Government.
Echoing similar sentiment, Assocham President Rana Kapoor said taxpayers need to expect a lot more from Government services, as they pay their taxes and deserve better services. “We need to better articulate our expectations. They (Government) have to deliver at all levels of the pyramid,” Kapoor said.
India needs a Formula 1 type economic momentum, Kapoor said, adding that the country deserved 10 per cent economic growth. “The last 5 years had been wasted in sluggish growth,” he added.
“Unfortunately we have had this limbo literally in the last couple of years where there is no real serious explanation to solving problems. Bankers have been unfortunately restricted. India still needs 2-3 more development institutions.” Small repair jobs will not work, he added. India needs to focus more on getting the best foreign direct investment (FDI) rather than only worry about foreign institutional investor (FII) flows. “We are still not able to attract as brand India the best FDI. We need stability of FDI and also remove inscrutability of any such investments. The moment that will happen even Indian capital waiting somewhere will contribute to the capital formation within India,” said Kapoor.
Focus on GST roadmap
Rajat Kathuria, Director & CEO, ICRIER, said the new Government should focus on quickly devising a roadmap for Goods and services tax (GST) implementation. “You will get a bounce in GDP (economic growth) if GST is implemented. What we need is immediately implement GST and also look at broadening the tax (direct) base. The why is very clear. But the how is not and we need a consensus,” he added.