Next gen GST reforms will set economy open and transparent: Sitharaman

Sitharaman urged banks to boost credit, support infrastructure, fund MSMEs, bring the unbanked into formal banking, and meet diverse financial needs for Viksit Bharat 2047

The next generation GST reforms would 'absolutely' set an economy open and transparent with further reduction in compliance burden and benefiting small businesses, Union Finance Minister Nirmala Sitharaman said on Tuesday.

She was speaking at the 120th Foundation Day celebrations of Tamil Nadu-based City Union Bank, where President Droupadi Murmu was the chief guest.

Sitharaman said Prime Minister Narendra Modi recently announced the creation of a Task Force for next generation reforms with a clearer mandate to simplify regulations, lower compliance costs and also build a more enabling ecosystems for startups, Micro, Small and Medium enterprises and entrepreneurs.

"Complementing this, the planned roll out of the next generation GST reforms with the planned Council meeting tomorrow and day after, will set an economy absolutely open and transparent in the coming months and with further reduction in compliance burden, making it easier for small businesses to thrive" Sitharaman said.

In his Independence Day address, PM Modi announced big-ticket Goods and Services Tax (GST) reforms and promised a Diwali bonanza for citizens.

Sitharaman further said that if India is advancing towards its vision of Viksit Bharat 2047 then the banks are called upon to not only expand credit but also provide momentum for infrastructure development, ensure timely and need-based funding for MSMEs, bringing the unbanked into the fold of formal banking and meeting diverse requirements where the support of banking channels was vital.

"The guiding principles for this transformation must be trust, technology and transparency." she noted.

Over past 11 years, 56 crore Jan Dhan accounts have been opened with total deposits of Rs 2.68 lakh crore, and majority of the account holders were women, she said.

Sitharaman also pointed out that Indian scheduled commercial banks have recorded massive improvement in asset quality. Credit rating agency S&P has upgraded the country's long term sovereign credit rating for the first time in 18 years, she added.