The Vice President of India, M Venkaiah Naidu has said that every citizen must consider it as his sacred duty to pay taxes as development and welfare measures would suffer if governments do not get adequate revenues.
He was addressing the National Seminar on Contemporary Challenges and Issues in Finance, Marketing and Taxation, held at Keshav Memorial College in Hyderabad today. The Deputy Chief Minister of Telangana, Shri Mohammad Mahmood Ali and other dignitaries were present on the occasion.
The Vice President said that while tax evasion has to be dealt with sternly, it should be ensured that there is no unnecessary harassment of the taxpayers by overzealous officials. Transparency in governance will ensure accountability and also improve remittances to the government, he added.
The Vice President said that with the introduction of GST, the biggest ever tax reform taken since Independence, India is finally ‘one-country, one-market’. This reform has changed the face of the indirect tax regime in the country as it imposes one tax instead of several taxes by various State Governments and the Union Government. It has made compliance easy for businesses and traders and demonstrated the victory of bipartisanship in the democratic and federal set-up of India, he added.
India’s tax-to-GDP ratio is 16.6 percent in FY2017, which compares with 26.0 percent in the USA, 20.1 percent in China, and 34.3 percent in OECD countries. India needs to significantly ramp up its tax-to-GDP ratio to fund a modern 21st-century government which can offer basic public goods and social security to its citizens. Direct tax collected in FY2018YTD has grown at 18.2 percent. This increase in the collection has been driven by an increase in compliances with the number of taxpayers increasing for both direct and indirect taxes. 5.9 million tax-payers have registered for GST and 28.2 million people filed their income-tax returns for FY2017.
Demonetization, SIT on black money and notification of the Benami Transactions Act, 1988 are some of the strong steps taken to bring more economic activity into the tax net, even as the war on black money needs to continue unabated.
The Vice President said that the expanding middle class will be the key driver of India’s economic growth in the coming years and the need of the hour is to take full advantage of this demographic numbers by creating adequate job opportunities for the young population. Merely turning out lakhs of students with degrees is not enough, we have to provide them skills not only to earn a livelihood but life skills that will enable them to deal effectively with any situation.
He opined that the education system should be re-oriented to not only impart life skills to students but also to ensure that youngsters remain committed to strong ethical and moral values. Whatever be the line of their professional pursuit, they all must remain wedded to India’s age-old cultural and syncretic values best embodied by the concept of Vasudhaika Kutumbakam, he added.