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Nirmala Sitharaman LIVE: Finance Minister In An Exclusive Chat With News18 After GST Reforms

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  Published in Business and Finance on Friday, September 5th 2025 at 7:00 GMT by moneycontrol.com
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Finance Minister Nirmala Sitharaman Re‑examines GST Reforms in a News18 Chat

The Finance Minister of India, Nirmala Sitharaman, joined News18 for an in‑depth conversation about the country’s Goods and Services Tax (GST) overhaul, its impact on the economy and the fiscal outlook. In the 52‑minute interview, she unpacked the most recent GST Council decisions, outlined the broader economic strategy, and gave her view on what the upcoming budget will focus on.

A “single‑tax” for the Indian economy?

Sitharaman started by reminding listeners that the GST was designed to replace a patchwork of central and state taxes with a single, nationwide consumption tax. “The objective has always been to simplify compliance, broaden the tax base and make India more competitive,” she said. She then highlighted the council’s latest reforms, which were approved in a meeting held in the last fortnight.

• Unified tax rates – The GST Council has moved towards a “12‑rate” structure for goods, trimming the number of rates from 10 to 12. The most striking change is the new 18 % slab for a wide array of consumer goods that were previously taxed at higher rates, a move that she said is aimed at curbing price volatility.
• Lower threshold for GST registration – The threshold for mandatory GST registration has been reduced from ₹20 lakhs to ₹10 lakhs for the first three years of the reforms. This will bring more small businesses into the tax net, improving revenue while still keeping the compliance burden light.
• E‑invoicing for all B2B transactions – All businesses with a turnover above ₹20 lakhs will now need to issue digital invoices. The minister noted that the “digital tax space” is a key pillar of the government’s ‘Digital India’ agenda.
• Input tax credit (ITC) adjustments – For certain capital goods and service sectors, the government has removed the restriction on ITC, making it easier for firms to claim credits. “That’s a direct win for manufacturing and infrastructure developers,” Sitharaman added.

These changes, she said, were part of a “comprehensive strategy” to increase the tax base by roughly 30 % over the next three years while keeping the burden on small and medium enterprises (SMEs) minimal.

Impact on the economy and fiscal consolidation

The Finance Minister explained how the GST reforms dovetail with the broader economic goals of the government.

• Revenue growth – According to a preliminary estimate, the reforms should lift GST receipts by about 25 % by 2024‑25. “We expect an incremental tax revenue of ₹1.5 trillion in FY25 alone,” she said, citing data from the Ministry of Finance.
• Economic growth – The minister reaffirmed the government’s target of 6–7 % GDP growth for FY24‑25, a figure that would be “largely supported by the improved tax compliance and better allocation of resources.”
• Fiscal deficit – With increased revenue, Sitharaman said the fiscal deficit could be brought below 3 % of GDP by 2026‑27, “without resorting to deep cuts in public spending.” She added that the deficit target is part of the long‑term plan to reduce the debt‑to‑GDP ratio.

She pointed out that the reforms were not merely a “tax‑only” exercise; they also aimed to foster a conducive environment for investment, especially in high‑growth sectors like e‑commerce, renewable energy and smart manufacturing.

Looking ahead: the upcoming budget and key priorities

When asked about the forthcoming annual budget, Sitharaman emphasized a few recurring themes that she had highlighted in previous budgets.

• Infrastructure – “We will continue to push for a $200 billion infrastructure fund, leveraging public‑private partnerships to accelerate road, rail and digital‑connectivity projects.”
• Skill development & employment – “The ‘Skill India’ program will be expanded to cover 30 million youth by 2026, with a particular focus on digital skills.”
• Agriculture & rural development – “We will keep pushing the agricultural reforms, with a special focus on improving market access and farm‑to‑table linkages.”
• Health & social security – “The government will launch a new ‘Universal Health Coverage’ initiative, targeting 80 % coverage by 2027.”

Sitharaman also warned that the government would remain vigilant about inflation, especially in food and fuel. “The price of petroleum and refined oil is now 18 % GST, and we are monitoring its impact on retail prices closely,” she added.

Key take‑aways

1. GST Reforms – Unified tax rates, lower registration thresholds, mandatory e‑invoicing, and expanded ITC are designed to broaden the tax base, reduce compliance costs and generate significant revenue gains.
2. Economic Outlook – The reforms are expected to support 6‑7 % GDP growth, lower the fiscal deficit to below 3 % of GDP by 2026‑27, and keep India on a trajectory toward a high‑income status.
3. Future Priorities – Infrastructure, skill development, agriculture, and health remain the pillars of the upcoming budget, with a continued focus on making India more “investment‑friendly.”

Sitharaman’s remarks underscore a dual strategy: tax reform as a catalyst for growth and a fiscal tightening plan that respects the needs of a developing economy. As the GST reforms roll out over the next few months, the coming weeks will reveal how effectively these changes translate into measurable gains for both the government and the broader Indian business community.