India’s Finance Ministry plans to introduce faceless assessment for goods and services tax, aiming to streamline procedures, reduce direct contact, and ensure consistent decisions, beginning with central taxpayers before expanding nationwide.
India’s Finance Ministry is preparing to extend faceless assessment to goods and services tax, beginning with taxpayers handled by central formations, in a move aimed at reducing direct contact between businesses and tax officials and making decisions more consistent. A senior government official said the scheme could be introduced within months, with state administrations later allowed to opt in. The plan mirrors India’s faceless income tax and customs systems, which were designed to replace much of the traditional officer-to-taxpayer interface with digital processing and team-based review.
The proposal comes as GST has grown into a vast, decentralised system with more than 1.70 crore registered taxpayers. Of those, over 73.5 lakh are under central formations, while more than 97 lakh are assessed by states and Union territories with legislatures. Current jurisdictional allocation is based largely on turnover: larger taxpayers are split evenly between the Centre and the relevant state, while smaller businesses are mostly assigned to the states. That structure means any faceless regime will have to be introduced carefully, particularly if it is later expanded beyond central cases.
Tax specialists say the change could be especially useful for companies operating across several states, as well as exporters and large manufacturers, which often face repeated scrutiny in different jurisdictions. Harpeet Singh, a partner at Deloitte, said a faceless framework could represent the next stage in GST’s digital development, improving administrative efficiency while also making tax treatment more predictable. He argued that a more trust-based system would help reduce interruptions to business operations and support more objective decisions.
Other advisers, however, are urging the government to phase in the system rather than roll it out across every kind of dispute at once. Brijesh Kothary, a partner at Khaitan & Co, said implementation should begin with routine scrutiny and smaller demands before extending to more complex matters once the model proves itself. He said the greatest benefit for taxpayers would be less dependence on a single officer. If notices, replies and hearings are all logged online and cases are assigned randomly, he said, there is much less scope for arbitrary conduct. Kothary added that exporters, e-commerce operators and large manufacturers are likely to gain the most, particularly if faceless assessment is paired with single-window registration and quicker risk-based refunds.
Vivek Jalan, a partner at Tax Connect, said the system would work best if it were built with strong taxpayer protections from the outset. He called for reasonable time limits to respond before adverse orders are issued, a legal right to seek video hearings when additions or negative findings are proposed, and recordings of those hearings to be made available online as part of the official record. Jalan also said an independent grievance channel, separate from the assessment unit, would help resolve procedural issues quickly and strengthen confidence in the process. He said such safeguards would protect natural justice while supporting the government’s wider aim of creating a transparent, technology-led indirect tax administration.
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