FinMin sets up committees to review tax slab
NEW DELHI: The finance ministry has set up two committees of state finance ministers who would review current tax slabs and goods and service tax (GST) exempt items, identify potential evasion sources and suggest changes in IT systems.
The Group of Ministers (GoM) on rate rationalisation would also review inverted duty structure, recommend rationalisation measures, including merger of tax rate slabs.
The 7-member panel, which would submit a report in two months, would be headed by Karnataka Chief Minister Basavaraj Bommai and include West Bengal finance minister Amit Mitra, Kerala finance minister K N Balagopal, Bihar deputy Chief Minister Tarkishore Prasad. It would also review the supply of goods and services exempt under Goods and Services Tax with an objective to expand the tax base and eliminate breaking of ITC chain.
The GoM on GST system reforms would identify potential sources of evasion and suggest changes in business processes and IT systems to plug revenue leakage. The eightmember panel, headed by Maharashtra Deputy Chief Minister Ajit Pawar, would include Delhi Deputy Chief Minister Manish Sisodia, Tamil Nadu finance minister Palanivel Thiaga Rajan and Chhattisgarh finance minister T S Singh Deo.
The panel would review IT tools and interface available with taxmen and suggest ways to make them more effective, identify possible use of data analysis towards better tax compliance and suggest ways of better coordination between central and state tax officers.
The decision to set up these two GoMs was taken by the GST Council, chaired by Union Finance Minister Nirmala Sitharaman, on September.
Bommai’s panel will suggest ways of rationalizing tax rates and correcting tax anomalies to simplify the tax structure, reduce disputes relating to the classification of goods and services and boost revenue collection of central and state governments.
The Bommai panel will suggest changes that may be rolled out immediately and give a blueprint for the changes needed in the short to medium term.
The group has two months to submit its report, according to one of the orders.