Ahead of the presentation of the Union Budget 2023-24 by Finance Minister Nirmala Sitharaman on February 1, industry bodies and the corporate sector expect more tax reforms, especially rationalisation of indirect taxes. All eyes are on the Finance Minister as to whether she will announce a more friendly tax regime with respect to the Goods and Services Tax (GST).
Multiple wish lists have been making their way to the Finance Minister, calling for tweaks in GST norms and rationalising tax slabs for different sectors, among others.
Speaking of indirect taxes, ever since the introduction of the Goods and Services Tax (GST), indirect taxes, including excise duty, service tax, and sales tax, have fallen under its umbrella, and now indirect taxes mainly comprise excise duty on diesel, petrol, and alcohol, along with some customs duty on imports.
The Confederation of All India Traders (CAIT) in its 18-point budget charter has asked the Finance Minister for a fresh review of the GST system and to launch a one-nation-one-license policy along the lines of a one-nation-one tax.
Experts are of the view that the last full budget by the incumbent Finance Minister could see the inclusion of various newer products under the Production Linked Incentive (PLI), thereby widening the ambit of the scheme. The indirect tax collection in the ongoing financial year could exceed the Budget 2022-23 estimates of Rs 13 lakh crore.
Further, there is anticipation that the current indirect tax structure could be simplified even more. Not just experts, the World Trade Organization (WTO) Trade Policy Review has also highlighted the need for the Indian tariff structure to become more lucid for exporters and importers, as complexity leads to prolonged litigation.
An elaborate amnesty scheme for customs duties is also required, which could put to rest all the procedural disputes revolving around the GST law since its introduction.
