"Any initiative in the design of a good tax policy could fail at the door of the TA (Tax Administration). While tax policy can be appropriately set to minimize the burden that the tax system imposes on business, this could be completely undermined by a poor TA," says 'A Handbook for Tax Simplification' published by the World Bank Group in 2009.

The Handbook also lists steps to simplify TA. The preliminary steps in this process include preparing " detailed process maps of all administrative functions" and removing "redundant processes" and combining others.

If anyone today needs to act on this advice, it is Indian Government. In spite of 21 years of tax reforms, the job of a statutory and autonomous tariff commission is performed by four appendages!

The job is split between a lame-duck Tariff Commission (TC) that operates under the Department of Industrial Policy and Promotion, Chief Advisor Costs (erstwhile Cost Accounts Branch of world war vintage) in Department of Expenditure, Director General of Anti-Dumping and Allied Duties (DGADAD) in Department of Commerce and Director General, Safeguards (DGS) under Central Board of Excise and Customs in Department of Revenue .

The duties currently being performed by all these authorities can all be combined and assigned to a Tariff Commission, which can be transformed into a statutory body either through an amendment of the existing law or by enacting a new one.

No official committee has recommended such an initiative though the idea of merging DGADAD and DGS or handing over their functions to a statutory TC has been recommended by different committees in the past. Before discussing the latest recommendation on this count, it would be better to first compare India with other countries to underscore the importance of tariff and economic efficiency through a focused approach.

The convoluted history of TC can itself serve as a case study of tariff reforms getting checkmated by turf battle among departments and bureaucratic dithering on reform initiatives.

Indian Government has to just look towards the East and the West to take a cue. On the East, Bangladesh has one statutory entity that is empowered by Bangladesh Tariff Commission (BTC) Act 1992.

BTC says: "Any matter relating to the protection of or assistance to domestic industries or the efficient use of resources in any industry may be referred to the Commission by the government or the business community for recommendations on appropriate course of action. The Commission also advises the government on inducing greater competition in industrial production; encouraging efficient use of resources in the economy, obtaining greater market access through bilateral, regional and multilateral trade agreements; and taking remedial measures against dumping and other unfair trade practices in respect of imports into Bangladesh."

On the West, Pakistan has a similar entity that was established in 1990 under the National Tariff Commission Act.

Other countries have such statutory tariff commissions or other entities that perform all functions under a single roof. Take the case of the United States International Trade Commission (USITC). Established by Congress in 1916 originally as the U.S. Tariff Commission, it was rechristened USITC under the Trade Act of 1974. Apart from the usual job of recommending anti-dumping, safeguards and countervailing duties, it undertakes myriad of studies. These include a periodic study that analyses 'The Economic Effects of Significant U.S. Import Restraints .' The seventh study in this series released in August 2011, reckoned that U.S. economic welfare would increase by about $2.6 billion annually by 2015 if the US unilaterally ended all significant restraints as specified in the study.

Tariff Commission in India cannot have the audacity of undertaking such an independent study and making it public. It only undertakes studies at the behest of different ministries and other Government entities. Most of these studies have been kept under wraps, thereby depriving professionals an opportunity to understand the prospects of improving economic efficiency through tariff reforms.

CAC works in the same fashion as TC. Most of their studies have direct or indirect bearing on the excise and customs tariff for different industries.

As for protection against unfair imports, the companies continue to knock at the door of DGADAD and/or DGS.

Much before the present situation evolved, India has had a statutory TC that was created in 1951by upgrading the pre-Independence Tariff Board. TC used to conduct various studies including suo-moto ones and recommend to the Government appropriate changes in excise and customs tariff.

TC was abolished in 1976 at the recommendation of Second Fiscal Commission. It concluded that TC's functions overlapped with that performed by Bureau of Industrial Costs and Prices (BICP) that was created in 1970.

In 1991-92, the year of launch of India's big-bang economic reforms, Dr. Manmohan Singh, who had then taken over as Finance Minister, thought of undoing this retrograde step.

In the budget speech delivered in July 1991, Dr. Singh stated: "I believe that the time has come to evolve a more transparent institutional mechanism for fixing tariffs and domestic prices in sectors where there might still be need for protecting Indian industry against foreign competition and for the determination of administered prices, particularly in the area of public utilities. For this purpose, we propose to restructure the Bureau of Industrial Costs and Prices and to transform it into a Tariff Commission."

Dr. Singh's proposal remained a non-starter for several years as the Revenue Department opposed sharing its tariff-setting powers with BICP, which operated under the then Industry Ministry.

When P. Chidambaram first became Finance Minister following change of ruling alliance, he announced in his maiden budget speech on 27 July 1996 that the "Government have also initiated action to set up an independent Tariff Commission."

TC was finally constituted in September 1997 with grandiose objectives that included advising the Government on goods and services tariff and evolving an overall tariff structure. The other major objectives include study of critical market access offers received from trading partners as part of WTO framework and to advise the Government on the opportunities and challenges generated by these offers; identification of the tariffication process for select economic activities and monitoring the tariff changes in the competing and trade-partner countries and maintain an inventory of tariff rates.

TC, however, commenced operations in April 1999 that is only after BICP was merged with it. The merger was done to equip TC with requisite manpower.

Even as the fledging TC was trying to gain roots, it received a shocker in 2001: Expenditure Reforms Commission (ERC) recommended that TC should be abolished. It suggested that a new statutory commission could be set up after 3 to 5 years to advise Government on tariff policy and anti- dumping and safeguards duties.

A year later, the Task Force on indirect taxes chaired by Dr. V.L. Kelkar, the then Adviser to Minister of Finance and Company Affairs, took a different stance. In its report submitted in December 2002, Task Force recommended that an "independent body such as the Tariff Commission should be suitably strengthened to conduct the work of investigations such as injury determination, dumping margin, etc . relating to Safeguard duties and Anti-dumping."

The Government has neither scrapped TC nor set up a statutory TC nor strengthened it. The issue has dodged solution in spite of repeated recommendations and stinging recommendations made by Parliamentary Standing Committee (PSC) on Commerce in its reports since May 2002. What is more, the uncertainty persists in spite of categorical stance of Department of Expenditure against ERC's recommendation to wind up TC.

In a letter to DIPP written in July 2003, Expenditure Department opined that "instead of winding up, the Tariff Commission should be restructured with an independent identity to subserve the role assigned to it."

Notwithstanding this, DIPP circulated a draft Cabinet Note proposing the winding up of TC as recommended by ERC.

Department of Commerce and Department of Personnel and Training agreed with the proposal. Expenditure Department, on the other, suggested that TC should be restructured and also vested with functions of anti-dumping and safeguards. It also proposed that TC might be transferred to the Department of Commerce from DIPP.

Department of Commerce, however, did not agree to either vesting the functions of anti-dumping, or transfer of Tariff Commission.

The Government is yet to decide how to restructure TC and select the Ministry that should exercise administrative control over TC.

One can only hope the Government finally puts its acts together on TC. As put by PSC in its latest report submitted to Parliament on 30 April 2012, " time has come to take a final call on the matter keeping in view the demands of various stake-holders for competitiveness and fairness in goods and services."