Next-gen GST reforms to reduce compliance burden, aid small businesses: FM Sitharaman

FM Nirmala Sitharaman

The rollout of the next-generation Goods and Services Tax (GST) reforms will lead to an "open and transparent" economy, and reduce compliance burden further, aiding small businesses to thrive, Finance Minister (FM) Nirmala Sitharaman said on Tuesday in Chennai.

The GST Council meeting, which will take up the much-awaited issue of GST rate-rationalisation, is set to be held in New Delhi on September 3 and 4. The FM was addressing the 120th Foundation Day Celebrations of City Union Bank in Tamil Nadu’s capital city.

In her address, Sitharaman said that the new ‘Task Force for Next-Generation Reforms’, as announced by Prime Minister Narendra Modi, has a clear mandate to simplify regulations, lower compliance costs, and build a more enabling ecosystem for start-ups, MSMEs and entrepreneurs.

The FM noted that even in these challenging times, India’s economic fundamentals remain resilient and continues to be one of the fastest growing major economies.

She highlighted that India’s real GDP registered a growth of 7.8% in Q1 FY26, beating many estimates and showing overall good momentum across various sectors.

"For the first time in 18 years, India's long-term sovereign credit rating has been upgraded by S&P. Inflation rates have registered 9 consecutive months of decline and reached an 8-year low of 1.55% in July 2025," noted the FM.

Additionally, Employees’ Provident Fund Organisation (EPFO) recorded all-time net addition of nearly 22 lakh members during June 2025, marking the second consecutive month of record high additions, the FM said. "PMI Manufacturing reached its highest level in 17 years (in July 2025). And India’s fiscal situation has improved steadily, with fiscal deficit down from 9.2% post-COVID and expected to reach 4.4% this year."

On the banking sector, Sitharaman said that over the past 11 years, more than 56 crore Jan Dhan accounts have been opened, with a total deposit balance of Rs 2.68 lakh crore. Of these accounts, 67% were opened in rural or semi-urban areas, and women hold 56%.

As India advances towards the vision of 'Viksit Bharat 2047' mission, all the banks are called upon to not only expand credit but also: provide momentum for infrastructure development, ensure timely and need-based funding to MSMEs, bring the unbanked into the fold of formal banking, and meeting diverse requirements where the support of banking channels is vital, said the FM.