The Finance Minister said he foresaw an India in the coming decades where voluntary compliance increases.

Union Finance Minister Arun Jaitley on Monday said India needs lower taxes to compete globally and that voluntary tax compliance by citizens should be encouraged by a friendly administration.

Mr. Jaitley was inaugurating professional training of the 68th batch of the Indian Revenue Service officers at the National Academy of Customs, Excise and Narcotics.

“We have lived through the last seven decades in India under the impression that if avoidance could be done of government revenue, then there was nothing immoral about this. That was considered commercial smartness,” he said.

“Payment of legitimate taxes is part of a citizen’s duty, and non-payment is visited with severe consequences.”

According to the Minister, “extraordinarily high taxation rates in the past” had encouraged people to evade taxes. “What you need is lower level of taxation, to provide services more competitive in nature.”

“Competition is not domestic, it is global. This is one important change you will witness while you will be in service.”

Voluntary compliance

He said he foresaw an India where voluntary compliance increases. “Tax authorities are judged by the quality of what they write or decide. The level of fairness followed by authorities will define the quality of interpretation of tax laws by authorities. The voluntary compliance by citizens by payment of due taxes needs to be reciprocated by authorities through a tax-friendly administration.”

Mr. Jaitley also told the trainees that tax officers should have high integrity.