The conference aimed to strengthen collaboration between the industry and the government to create a tax environment conducive to growth, innovation, and sustainability. New Delhi: The Society of Indian Automobile Manufacturers (SIAM) held its 2024 conference on automotive taxation, focusing on how tax policies can support the industry's growth and India's economic development. The conference addressed key issues like simplifying the Goods and Services Tax (GST), customs valuation, transfer pricing, and the role of digital transformation in easing business operations. Government officials and industry leaders participated, discussing opportunities, challenges, and potential solutions for creating a more supportive tax environment for the auto sector.
A major theme of the conference was the need for a long-term vision for the automotive taxation ecosystem. This includes simplifying tax procedures, promoting investment in new technologies, and adapting to emerging business models. Discussions also focused on streamlining GST audits and improving cross-state document verification processes.
Yogendra Garg, Principal Director General of Systems at the Central Board of Indirect Taxes and Customs (CBIC), stressed the importance of a five-year tax vision. He highlighted the government's commitment to supporting the auto industry's growth through aligned taxation systems.
“The automobile industry has grown significantly, with the government aligning taxation systems to support this vital sector. In line with the growing Government-Stakeholder consultation in India, the Auto Industry must create a long-term, 5-year tax vision. This vision should outline the nature of the taxation ecosystem we aim to build and then create a roadmap to work toward achieving it. Committed to 'Viksit Bharat' by 2047, we seek to address challenges and foster growth by envisioning the direct and indirect tax ecosystem, thus ensuring sustainable development,” Garg said.
Sanjay Mangal, Principal Commissioner at CBIC, said, “In the past 4-5 years, GST has undergone multiple changes, emphasizing the government's commitment to simplifying policies, reducing litigations, and fostering ease of doing business. We are actively streamlining compliances and have begun to bring more clarity and strengthen these processes. Additionally, the government views the auto sector favourably, we encourage industry recommendations to further streamline GST audits and trial balances, aiming to enhance document verification processes across state jurisdictions.”
Rajesh Shukla, Chairman of SIAM's Taxation Policy Group and Head of Indirect Taxation at Tata Motors, said, “There is a need to create a Tax Eco system that encourages the industry to invest in new technologies, especially as the Auto Industry undergoes a phase of rapid technology transition. Moving forward, simplifying tax procedures will ease business operations, and flexible tax policies can support emerging business models without compromising revenue. We also aim to explore the simplification of international taxation and adoption of new technologies in tax policy-making, fostering innovation and driving sustainable economic growth.”
Sanjeev Agarwal, Chairman of SIAM's Direct Tax Group and Head of Taxation and Customs at BMW India, said, “Government authorities are significantly ahead of the industry in terms of data capabilities, often approaching us with pertinent questions that underline the need for the industry to leverage technology to enhance our data collection. Industry has to make logical and reasonable proposals, as the government is genuinely interested in understanding and considering industry recommendations.”
D.D. Goyal, Former Chairman of SIAM's Taxation Procedure Group and Executive Advisor of Finance at Maruti Suzuki, commented, “GST has been a transformative expressway built by the government, streamlining complexities present before 2017 and resolving issues related to transit vehicles, used car taxation, and extended warranties. As we move towards complete digitization, further enhancements like a dedicated mobile application or waiving off digital signatures on invoices could revolutionize our efficiency. Additionally, guidance on managing demo vehicles and vehicles used for testing can further smoothen our journey on this new tax expressway.”
Pramod Kumar, Executive Vice President of the Goods and Services Tax Network, highlighted, “Since the inception of GST, the Centre and the states have exhibited commitment and cooperation, embodying true federalism to ensure its success. Over the past seven years, virtually all decisions within the GST Council have been unanimous, demonstrating a collective readiness to address and resolve issues promptly post-rollout. The transformative digitalization of the GST system—centralized on a single, high-concurrency, scalable, and reliable platform—has been pivotal. We remain focused on enhancing the efficiency and compliance of the GST framework, always considering the industry's feedback to refine our approach.”
The conference also saw participation from other key industry figures, including Rajesh Menon, Director General of SIAM; Sanjay Seth, Co-Chair of SIAM's Direct Tax Group and Head of Taxation at Hero MotoCorp; Anil Sahani, Co-Chair of SIAM's Taxation Procedure Group and Vice President of Finance and Head of Tax at Maruti Suzuki; and Veeresh Prasad, Co-Chair of SIAM's Taxation Policy Group and General Manager of Indirect Taxation and Impex at Toyota Kirloskar Motor.
The conference aimed to strengthen collaboration between the industry and the government to create a tax environment conducive to growth, innovation, and sustainability. The discussions emphasized the need for a proactive approach to adapt to the evolving automotive landscape and support the industry's contribution to national economic development.
