Tax administration may see some change thanks to Hasmukh Adiha’s initiative
A heartening move that has attracted little media, or public, attention is the series of tweets by Hasmukh Adhia, who has recently taken charge as revenue secretary at the Union finance ministry.
Mr Adhia, whose twitter handle is @adhia03, tweeted: “I request people to send me their suggestions on tax reforms on my personal email ID address email@example.com.” More importantly, he added, “I would be opening this email myself so whistleblowers also kindly send me information with verifiable facts.”
Mr Adhia’s openness in sharing his personal email and the assurance to whistleblowers are very significant. One of the biggest worries for those who want to expose wrongdoing in India, and not merely by tax and enforcement officials, is vindictive action, if their identity is revealed. Government officials, even in the prime minister’s office (PMO) under different regimes, are extremely cavalier about revelations of whistleblowers’ identities, leading to their murder, as in the Satyendra Dubey case, or extreme harassment.
Mr Adhia has further said that using information technology (IT) to “bring transparency in the tax department” and “removing complexity of rules and procedure” is his top priority, followed by assessment of readiness to implement GST whenever it is approved by parliament. A positive move in that direction is the quick acceptance of the Justice AP Shah Committee’s report about granting relief on MAT (minimum alternative tax) to foreign institutional investors for the period before 1 April 2015. A clean-up of the tax administration is going to be key to every initiative of the government, whether it is rolling out GST (goods & services tax), building entrepreneurship and job creation, the ‘Make in India’ initiative or issues affecting large corporates and multinationals. In this context, it is heartening to see two of India’s most dynamic bureaucrats—Hashmukh Adhia and Amitabh Kant, secretary, DIPP (department of industrial policy & promotion) on the same page. After a very inspiring talk in Mumbai at Moneylife Foundation, the questions that Mr Kant was repeatedly asked were about harassment over taxes, the lack of a stable tax regime and lack of accountability. Mr Kant was himself was emphatic that the ‘Make in India’ effort would depend on a stable tax regime and predictable policies. The way forward lies in cutting the number of regulatory clearances and impediments to doing business by using technology which would improve India’s ranking in the ‘Ease of Doing Business Index’.
However, both, Mr Adhia and Mr Kant’s biggest challenge would be to tackle the deep vested interests among the rank and file at tax and investigation agencies, who, over the past decades, have become habituated to collecting bribes, not only for themselves, but also to buy promotions and postings and pass them up the line to senior officials. It remains to be seen how this will be dealt with.