Tax administration less adversarial: Finance Ministry

The finance ministry on Wednesday said that tax payers are of the opinion that there has been an attitudinal change in functioning of the officials from the Central Board of Excise & Customs (CBEC) and that the administration has become less adversarial.
The ministry in its statement noted that the CBEC had conducted a survey, in which 72 per cent of the respondents are of view that there is perceptible change in policies of the CBEC by way of becoming liberal and friendly to the taxpayer.

“45 per cent of the respondents saw an attitudinal change in senior functionaries and 51 per cent acknowledged an improvement at the ground level,” the statement said, adding that this indicates increasing maturity of the regulatory eco system in India.

“This should come as heartening news for India Inc, as it is the inspector raj which is considered as the most stubborn stumbling block to improving the tax environment,” the statement said.

The survey also pointed out that 32 per cent of the respondents hold opinion that the CBEC administration was becoming less adversarial, as against the allegations of tax terrorism, which has most often been cited as a barrier to entry of foreign investment in manufacturing.

“49 per cent of respondents acknowledged a positive change in processing of refunds. Of most interest to foreign businesses were responses to reforms undertaken in SVB (transfer pricing in customs) where 89% of the respondents indicated improvements,” the statement said. 92 per cent of the respondents acknowledged CBEC’s success in simplification of customs & excise business processes.

The most outstanding achievement of the CBEC was getting the customs single window project off-the-block on 1st April 2016, where CBEC’s team evolved a unique methodology to solve teething problems by creating a whatsapp group for continuously receiving a feedback on operational issues faced by the trade and disseminating solutions.

The ministry’s statement noted that respondents from Maharashtra outnumbered all states, with respondents making up for 30%, followed by Delhi.

“This trend reveals the importance that service tax has acquired over the years, broadening the tax payer base and accounting for Rs 2.11 lakh crore which is 26 per cent of the Indirect Tax revenue,” the statement said.