The historic GST is
struggling to stay in step with needs and expectations. The ink was barely dry
on the first draft, when it saw at least 11 amendments, and rates revisions of
nearly 100 items. The decade-old effort towards ‘one nation, one tax’ was to unify
the tax system, but the grim reality is, it repulsed companies, the worst-hit
being SMEs, blew out growth prospects and failed to juice the economy. The
Ministry of Finance, which celebrated GST’s successful rollout, is now sweating
the gory details undertaking several markups and revisions to smooth out its
kinks.
The good news is, the GST Council is pushing for a quick and painless
debate on the way forward. With inefficiencies tumbling out by the day, the
Council is moving swiftly to keep the chatter low and work with a single-minded
intent to prune its structure. As we speak, the Council is considering lowering
taxes on more products under the 28 per cent slab.
The changeover comes at a critical moment, but forces within the
government seem unhappy with former revenue secretary Hasmukh Adhia calling for
a complete overhaul to ensure the SMEs and common man aren’t burdened.
Officials are also hinting at bringing real estate, petroleum products and
electricity under the GST ambit.
Given that India has a
large MSME base, there’s an urgent need to standardise and simplify processes.
This could make the learning curve stretch longer, but is unavoidable. While
GST brought 27 lakh new registered entities into the tax net, just half file
returns. Relaxation from monthly to quarterly filings for SMEs is welcome,
issues involving invoices, delivery challans, and smooth rollout of e-way bill
could further improve compliance.
From Sources: -
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