Opinion | We need tax reforms to support India’s expenditure path

In this article for Mint, Niranjan Rajadhyaksha, Executive Director, Artha Global, emphasises the need for significant tax reforms to improve India’s spending abilities in the coming decades. Excerpts below:

“The upshot: tax reforms should be one of the key policy concerns of the third Narendra Modi administration. India needs to increase the amount of tax collected for every unit of economic output, otherwise it will have to compromise on either its spending requirements or its fiscal fitness.”

“Direct tax rates need to be low, stable and predictable. The average GST rate is now below what most studies show is the revenue-neutral rate. That needs to be fixed, even as the overall GST structure is simplified. A higher tax-to-GDP ratio will not only allow for more budgetary freedom but also hopefully strengthen the fiscal base of the Indian state in the years ahead.”

Read the full article here.

Image sourced from Mint.

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