Government sensitive to concerns of investors, says RBI Governor

India could have done a better job in handling tax issues, and the investors’ unhappiness over the taxation issues could have been avoided, says the RBI Governor.

 The Dollar Business Bureau Investor The expectations from the new Indian government when it came to power were probably unrealistic, however, the government has taken steps to propel growth. A statement in this regard was reportedly said to have been made by Raghuram Rajan, Governor, Reserve Bank of India. The new government came in with tremendous expectations and the kind of expectations was probably unrealistic for any government, he added. The new NDA government has also taken steps to create a business-friendly environment for investment and by being sensitive towards the investors’ concerns, the government is also looking at addressing key economic issues, he noted. Stating that taxes are big part of the business environment, the RBI Governor also informed that there are several areas where the government has taken serious and significant measures to improve the investors’ confidence. But, India could have done a better job in handling tax issues, he said, adding, ‘the investors’ dissatisfaction over the concerning taxation issues could have been avoided.’ However, the issues once raised, will have to go through the legal procedures in order to get resolved and the process in this regard is on, he noted. In this regard, he was quoted to have said, “Once the tax authority has levied a demand on you, there is a quasi-judicial nature of that proceeding and, therefore, it has to go through the courts before it is resolved. The government cannot intervene.” Going forward, the government intends to avoid these kinds of stuff, added the RBI Governor, further informing that the corporate tax will also come down 1% every year going forward. On the issue of subsidies in case of petrol and diesel, the RBI Governor informed that the subsidies in petrol and diesel have gone and going forward, these will be directly transferred to bank accounts. The RBI Governor further informed that there is a broad consensus on the Goods & Service Tax (GST) Bill and opined that there is enough momentum to push the bill ahead in time and be rolled by next year. The another key legislation that the government is focused on is the Land Acquisition Bill, which is important from the perspective of certain public works, he added.      

May 21, 2015 | 1:03 pm IST.

The Dollar Business Bureau - May 21, 2015 12:00 IST