Latest Expert Exchange Queries

GST Demo Service software link: https://ims.go2customer.com
Username: demouser Password: demopass
Get your inventory and invoicing software GST Ready from Binarysoft info@binarysoft.com
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
 
 
 
 
Popular Search: Central Excise rule to resale the machines to a new company :: ACCOUNTING STANDARDS :: articles on VAT and GST in India :: cpt :: VAT Audit :: VAT RATES :: list of goods taxed at 4% :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: TDS :: due date for vat payment :: ACCOUNTING STANDARD :: form 3cd :: empanelment :: ARTICLES ON INPUT TAX CREDIT IN VAT :: TAX RATES - GOODS TAXABLE @ 4%
 
 
Service Tax »
 GST base looks set to be at least 25% wider than earlier tax regime
 Businesses struggle with multiple tax rates, returns
 Common use items exempt from e-way bill provision under GST
 Goods And Services Tax Sends Taxes Racing
 How GST lesson can unleash untapped potential of education sector in India
 Services sector PMI falls most in 4 years on GST
 Missing column in GSTR 3B form leaves input claims a shaky edifice
  Communication to the Central Excise/Service Tax Taxpayers on migration to GST
 GST not easy to implement but tax base expansion will benefit all
 Goods and Services Tax was not an easy reform to implement
 GST to expand tax base, bring down weighted average tax rate:

Government must l everage IT to modernise tax administration, improve quality of taxpayer services
March, 02nd 2012

In preparing his Budget 2012, the finance minister faces a difficult challenge of fiscal consolidation without stifling investment and economic growth.

Given the limited elbow room to raise revenues through higher tax rates, the government should focus on the third-generation (3G) tax reforms that can yield a fiscal bonanza similar to that from 3G spectrum auctions. These would be reforms that modernise tax administration.

The first-generation reforms consisted of rationalisation of the direct and indirect taxes levied by the Centre, broadening of their bases, and lowering of the statutory rates. The second-generation reforms were the replacement of state sales taxes by the value-added tax (VAT).

While these reforms resulted in improvement in tax compliance and provided a significant boost to tax revenues, they were limited to legislative changes and the rich dividends that could be reaped by having a modern, IT-savvy and taxpayer-friendly tax administration remain unrealised.

A facilitative tax administration is dependent on simplicity of the tax laws, infrastructure for tax administration, harmonisation and integration of laws and procedures across the country.

The reforms for achieving simplicity in tax laws and their harmonisation are an ongoing process and the goods and services tax (GST) is aimed at addressing this objective. The GST, if based on the flawless design recommended by the 13th Finance Commission, could well be the 4G reform. Pending its implementation, governments should focus on archaic, inefficient and ineffective tax administration.

Critical ingredients of a modern tax administration are automation and standardisation, quality taxpayers' services, avoidance of tax disputes and their quick resolution. The most pivotal reform among these is a more effective use of information technology. While India has made considerable progress in terms of computerisation, it is still very basic.

The significant role that IT can play in comprehensive automation and integration of processes, minimising discretion by officials, data capturing and analysis for guiding policy decisions and for enhancing taxpayer services, has not been tapped in full measure.

The current business processes, systems and facilities lack in transparency, which encourages rent-seeking behaviour and reduces the willingness of taxpayers to voluntarily pay taxes. At the state-level, particularly, the use of IT in VAT administration and for monitoring inter-state trade leaves a vast scope for improvement. As one senior official put it recently, "revenues their governments collect is not because of the effort by officials, but in spite of it".

The latest World Bank study on Doing Business ranks India at a dismal low of 147 out of 183 countries in terms of 'ease of paying taxes'. Investors lament aggressive interpretation of tax laws by assessing officers, which can lead to protracted litigation for decades.

The resulting costs and uncertainty hinder business. So, the finance minister's recent statement that the government aims to provide citizen-centric governance to improve taxpayer services and redressal of public grievances could not have been more timely.

The decisions and actions of tax administrations are guided by the assumption that the taxpayer is naturally inclined to avoid paying taxes.

This attitude must be replaced by a more cooperative and communicative approach. Modern tax jurisdictions like in the US and UK adopt a customer-oriented and outcome-based approach for taxpayers. While setting organisational objectives, establishing targets and evaluating performance, the emphasis is on parameters of 'customer' satisfaction along with business results.

An open, communicative approach towards taxpayers can be instrumental in bringing greater certainty in tax liability and quicker resolution of tax issues, which helps reduce litigation.

India is sitting on a blocked amount of more than 3 lakh crore on account of tax litigation, of which 2.2 lakh crore is stuck at the Commissioner (Appeal) level. These sums could be much lower if there was a more open and communicative environment.

Studies in Australia show that reduced disputes lead to better compliance and more revenues. In UK, the Advance Agreement Unit comprising of a team of specialists work with businesses to provide some certainty for future tax payments. Also, customer relations managers provide a single-point contact and take a lead role in engaging companies on open cases and draw up an action plan for case resolution.

The HMRC has established customer contact centres that focus on alleviating doubts of taxpayers and create an environment of customer friendliness.

At a time when governments worldwide are grappling with the burgeoning debts and fiscal constraints due to the global financial crisis, 'working smarter' has become a necessity for tax administrators. India too must lend absolute commitment to reengineering its administrative framework and implement it in the right earnest.

The multiplier effect of this 3G reform could have the potential to surpass the rich haul reaped from the 3G spectrum auctions - a win-win situation for taxpayers, the revenue department and the economy. A stable and efficient tax administrative environment would also spur foreign investments, crucial for India's economic growth

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Content Management System development CMS development Content Management Solutions CMS Solutions Content Management Services CMS Services CMS Software

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions