Finance Minister Urges Tax Experts To Suggest Removing Outdated Provisions, Calls For Evidence-Based Reforms

Finance Minister Nirmala Sitharaman addressed tax professionals at the ITRAF’s 8th International Tax Conference, urging them to suggest removing outdated tax provisions, not just seeking tax cuts. She requested proposals supported by data, including details like the number of taxpayers affected, compliance costs, revenue impact, and the consequences of proposed changes.

Sitharaman emphasized the government's focus on reducing disputes and improving compliance, aiming to simplify voluntary compliance while targeting enforcement cases. She highlighted increased monetary limits for departmental appeals, raising thresholds to ₹60 lakh, ₹2 crore, and ₹5 crore before various courts. Regarding GST reforms, Sitharaman stated that GST 2.0 has primarily addressed rate rationalization, while process reforms will be discussed at the upcoming GST Council meeting in October.

She acknowledged the challenges of taxing the digital economy, including cryptocurrency and cloud computing, and the need for clarity on these issues. Sitharaman also touched on commercial space activities, suggesting they should be taxed, while proposing more favorable treatment for research and development efforts.