Finance Minister Arun Jaitley on Monday said that the government was determined to overhaul the taxation system to make it “perfectly non-adversarial” and was hopeful of implementing the goods and services tax (GST) regime across the country next year.
Jaitley said that the indecisiveness of the erstwhile Congress-led United Progressive Alliance (UPA) government and the highly adversarial tax regime introduced by it had scared away investors.
He also criticised the UPA for introducing a new company law, which was completely “out of tune with the current business requirements.” He was speaking at a session “Invest in India: Financing for Future Growth” at the Vibrant Gujarat Global Investors Summit 2015 here on Monday.
He said that the National Democratic Alliance (NDA) government led by the BJP had set up a mechanism within the revenue department of the Ministry of Finance to suggest changes in the taxation system.
He said that the GST was expected to be rolled out across the country next year. Jaitley introduced the Constitution (122nd Amendment) Bill in the Lok Sabha on December 19 to roll out the GST regime.
The bill has to be passed by both Houses of Parliament with support of two-thirds of its members and has to be ratified by state legislatures before it could be brought into effect.
The move to fast-track the rollout of the GST was one of the initiatives of Prime Minister Narendra Modi’s government that was appreciated by the leaders of India Inc and chief executive officers of multinational companies at the summit on Sunday and Monday.
Jaitley said the government was opposed to retrospective taxation, mooted by the UPA, which caused much chagrin among the investors.
Jaitley took a subtle dig at the “two power centres”, Congress president Sonia Gandhi and the then prime minister Manmohan Singh, that existed during the 10-year-long tenure of the UPA government.
“In a democracy, the prime minister should have the last word. He should be decisive and he should be responsible for consequences. You cannot create a structure outside the government which can overrule the prime minister,” the finance minister said, lauding Modi for his decisiveness.
He listed the NDA’s recent initiatives to reassure investors and to bring the economy back on the growth path, like raising FDI cap in defence, railways and insurance sectors, as well as to amend the land acquisition law to remove roadblocks for acquiring land for industrial and development purposes.
