Nirmala Sitharaman Announces Faceless System for 2 Lakh Central GST Payers

Finance Minister Nirmala Sitharaman has announced a faceless system for 2 lakh central GST payers operating in multiple states. This comes after the Centre's and states' efforts to rationalise rates and streamline processes.

Following last year's rate cuts, the effective GST rate on all goods and services has decreased from 11.8% to 10.8%. This reduction, combined with procedural simplification, has led to the resolution of 99% of issues, according to the FM.

The government aims to introduce annual rate changes. Starting from April every year, in an effort to maintain stability and predictability in the GST system.

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The proposed framework is designed to provide a unified window for taxpayers with multiple GST jurisdictions. Streamlining scrutiny, returns, audit, adjudication, appeal, taxpayer services, and grievance redressal.

The Centre and states have undertaken rate rationalisation and process reforms to simplify the GST process. Aiming to reduce complexity and increase efficiency.

The proposed framework will undergo public consultation before the next budget and will be implemented during the next financial year.

The FM drew inspiration from the success of the faceless approach in income tax. This has been well-received by taxpayers, and plans to bring a similar reform to the administration of GST.

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Sitharaman clarified that the initiative is a government-led effort. Separate from the GST Council, and aims to address the needs of taxpayers with multiple GST jurisdictions.

Currently, taxpayers with a turnover above Rs 1.5 crore are split between central and state tax administrations, based on a specific formula set by the GST Council to ensure a single interface.

Administrative control over GST taxpayers will be maintained through a combination of central and state tax authorities. With the goal of providing a seamless experience for taxpayers.