Former BSE Chairman Sethurathnam Ravi Advocates Systemic Tax Reforms Amidst GST Threshold Debate

In a recent discussion with Tarun Nangia and industry experts, Sethurathnam Ravi, former BSE Chairman, delved into the implications of raising the GST arrest threshold from 2 crore to 3 crore and shared his insights on how it might impact taxpayers. Ravi highlighted the industry’s persistent demand for this adjustment, citing a pervasive fear of arrest that has prompted stakeholders to lobby the finance ministry for change. While the proposed increase appears modest, Ravi noted that the industry seeks further adjustments.

Ravi emphasized the government’s dilemma in striking a balance between supporting honest taxpayers and combatting fraudulent tax practices, which he described as rampant and concerning. He characterized the proposed threshold rise as a cautious step to gauge its effects, particularly with the introduction of E-invoicing to streamline processes.

According to Sethurathnam Ravi, effective taxation is crucial, but it must be implemented in a manner that minimizes panic and hysteria among taxpayers. He underscored the systemic nature of the issue, advocating for approaches such as engaging taxpayers in faceless interactions before issuing notices. Ravi stressed the importance of providing individuals with an opportunity to address interpretation difficulties before facing punitive measures, thereby avoiding unnecessary disruption to their lives and businesses.

Ravi proposed reforms in the notice issuance process, suggesting that notices should be subject to collective review and legal scrutiny to ensure accountability and fairness. He argued against individual discretion in issuing notices, advocating for a committee-based approach to enhance transparency and accountability throughout the process. By establishing clear standard operating procedures (SOPs) for notice issuance, Ravi asserted that officials could mitigate disputes and promote greater consistency in taxation practices.

In conclusion, Sethurathnam Ravi urged officials to prioritize systemic reforms in taxation procedures, emphasizing the need for collective accountability, legal scrutiny, and transparent processes to alleviate the burden on taxpayers and enhance compliance.

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