Open letter to finance minister Nirmala Sitharaman

To,
The Hon’ble finance minister,
Authorities of India,
North Block, New Delhi.

Topic: Suggestions for Simplifying Direct and Oblique Tax Techniques within the Upcoming Funds

Revered madam,

I’m writing to humbly current a couple of concepts to your consideration as you put together the forthcoming Union Funds. These suggestions purpose to simplify taxation, cut back litigation, and foster financial progress whereas leveraging cutting-edge expertise for long-term nationwide progress.

1. Simplification of Direct Taxes

A simplified direct tax construction can result in higher compliance, lowered litigation, and a extra clear system. I suggest the next:

• Two-Tier Tax Charges: Standardize direct tax charges to 25% for companies and 20% for salaried earnings, eliminating non-compulsory regimes and complexities.

• Minimalistic Laws: Redraft the Revenue Tax Act right into a concise five-page doc that’s easy, leaving no room for interpretation.

• International Treaty Community: Broaden India’s tax treaty community to foster ease of doing enterprise, whereas standardizing TDS guidelines to keep away from confusion.

• Decision of Contentious Points: Introduce a sundown clause for unresolved contentious issues, making certain legacy disputes are completely closed.

2. Allocation for AI-Pushed Analysis and Growth

To safe India’s place as a world chief in expertise and innovation, it’s important to speculate closely in synthetic intelligence-led R&D:

• Allocate 6-10% of the nationwide funds towards AI-driven initiatives, enabling breakthroughs in sectors like healthcare, agriculture, training, and protection.

• Set up state-of-the-art AI labs and public-private partnerships to catalyze innovation and commercialization.

• Use AI to enhance tax compliance, fraud detection, and useful resource allocation, lowering leakage and boosting effectivity.

3. Reworking GST right into a Actually Good and Easy Tax

GST reform holds the potential to considerably improve financial effectivity and transparency. The next roadmap may function a guiding framework:

• Single Normal Price: Transition to a uniform GST charge of 15%, phasing out a number of slabs and exemptions, with exceptions just for fundamental requirements.

• Inclusion of Key Sectors: Convey petroleum merchandise, ATF, and different contentious objects below GST, making certain seamless Enter Tax Credit score (ITC) circulate.

• Litigation-Free Surroundings: Shut all pending litigations by issuing clear pointers and prohibiting retrospective amendments. Represent a job drive to rewrite GST legal guidelines comprehensively.

• Expertise Integration: Leverage AI and machine studying for proactive fraud detection, compliance monitoring, and ITC optimization.

• Fairness and Help: Offset GST’s influence on weak populations by direct advantages akin to healthcare, pensions, or meals grants till earnings ranges rise or insurance coverage penetration improves.

Implementation Timeline:

• Brief-Time period (6-12 Months): Resolve all pending litigations, launch direct profit applications, and transition to a single GST charge.

• Medium-Time period (2027): Totally combine technology-driven compliance mechanisms and obtain common ITC circulate.

• Lengthy-Time period (2030): Part out direct profit transfers as per capita earnings rises, reaching a clear and environment friendly GST system.

Conclusion

These measures mirror a imaginative and prescient of simplification, transparency, and innovation in India’s tax system. By implementing these reforms, we are able to create a sturdy framework that fosters financial progress, reduces administrative burdens, and builds belief amongst taxpayers.

I’m assured that these solutions align along with your imaginative and prescient for India’s financial progress. I humbly request their inclusion within the upcoming Funds and can be privileged to contribute additional to this essential dialogue if required.

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