Priority to pass on tax cut gains

I think the next reforms are about non-financial regulators. That is a pending reform for a very long time... Nirmala Sitharaman Finance minister

- Gireesh Chandra Prasad & Utpal Bhaskar

Finance minister Nirmala Sitharaman will personally monitor whether businesses pass on the benefit of the goods and services tax (GST) rate relief announced on Wednesday by the federal indirect tax body, the GST Council, the minister said in an interview, highlighting the importance of consumers gaining from the tax reform for it to succeed. While several companies have already pledged to transfer the benefit, Sitharaman noted that the government will remain vigilant. She also indicated that the next wave of reforms will focus on strengthening the framework of non-financial regulators such as the Competition Commission of India (CCI) and the Food Safety and Standards Authority of India (FSSAI). Transitional arrangements are being put in place to ensure the smooth rollout of the new GST rates from 22 September, the minister said. Sitharaman expects consumption demand to get a boost during the upcoming festive season and meet the government's fiscal targets this year. The minister also indicated more flexibility in investment rules for Chinese projects. Edited excerpts:

After direct and indirect tax reforms, what are the next set of reforms that the government is undertaking? The prime minister in his Independence Day promised laws and policies fit for the 21st century.

First, I have to see to it that the GST rate reduction gets transmitted to people. GST reform shows bureaucracy, whether central or state GST-related, have worked with amazing speed and delivered.

It was a very rigorous and intensive exercise. It's like taking an exam, a very rigorous one. Whether it is actually reaching the people, is a different exam. I have to take that also. I will happily take that. The reform is being implemented from 22 September to ensure smooth transition.

How soon do you think increased consumption demand will offset the effect of the GST rate cut?