Delay in the constitution of Appellate Tribunals It has been 3 years since the successful implementation of the GST law; however, the benches of the GST Appellate Tribunal are yet to be constituted in any state. This results in pendency of litigations, which need to be addressed at the earliest to ensure cases under GST does not pile up, resulting in delays as was a common occurrence under the erstwhile laws.
Considering the positive and negative aspects, there are certain elements, which we believe require a significant policy change from the GST Council to align the GST law closer to its founding principles:.
The tenure of this authority was extended recently till 30 November However, in the absence of any methodology provided in the GST law, there have been cases where businesses have felt unfair treatment due to the order passed by the NAA, which requires businesses to repay huge sums to their customers. An unfavorable order from NAA also creates a negative impression about the values of a business in the minds of its customers.
The constitutional validity of the NAA is also a subject matter of many petitions pending across various High Courts. The GST Council should undertake a serious consideration of this matter and propose suitable changes to GST law to either notify a methodology for determining the profiteering or do away with this authority completely to achieve ease of doing business. The GST Council should look into this aspect and merge the various GST rates into fewer slabs to avoid confusion and minimize the possibility of unwarranted litigation.
Also, the different cesses such as Compensation cess, Kerala flood cess, Sugar cess should be abolished. A landmark change such as GST was expected to bring with it initial hurdles and difficulties. The government and GST Council, on most occasions, have acted proactively to help businesses overcome such problems as a result of which, many sectors are experiencing the benefits of having a single, unified tax structure.
With the GST regime becoming more or less stable, it is an opportune time for the government to look into the taxpayer's suggestions, recommendations and fix the pending loopholes and lacunae in the law and come out with the improvised version in the near future.
In our view, steps must be taken to safeguard against unwarranted litigation and to make the system more taxpayer-friendly.
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Learn More Accept. Money in bank in 24 hours Apply now. Views Share. Advantages of GST in India GST has brought together a number of indirect taxes under one umbrella, simplifying taxation for service and commodity businesses. GST is aimed at reducing corruption and sales without receipts. GST brings accountability and regulation to unorganised sectors such as the textile industry. The possibility of tax evasion is minimised completely with GST coming into action.
With GST, insurance premiums have become more expensive. Petrol is not under GST, which goes against the ideals of unification of commodities.
Apply for a Business Loan. Yes No. Thank you sharing your feedback. How would you rate this article. What did you dislike? Please select rating. The wholesaler's effective tax rate will, thus, be Rs. Similarly, if the retailer's margin is Rs. Total tax that cascades from manufacturer to retailer will be Rs. India has, since launching the GST on July 1, , implemented the following tax rates:.
The previous system with no GST implies that tax is paid on the value of goods and margin at every stage of the production process. This would translate to a higher amount of total taxes paid, which is carried down to the end consumer in the form of higher costs for goods and services. The implementation of the GST system in India is, therefore, a measure that is used to reduce inflation in the long run, as prices for goods will be lower. Real Estate Investing.
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While this seems simple, it was anything but because rules governing GSTs predecessor, the VAT differed from state to state. Besides processes varying from state to state, the process of getting a VAT registration was very cumbersome. To get a VAT required going to many government offices and meeting with many officials. Graft played a big part in getting a VAT registration. Since GSTs rolled out the process of starting a business has become very smooth. Those who want to start a new business need to only register for a GST.
As the process of registration is centralised, getting a GST number takes a fraction of the time that it took to get a VAT. In addition to eliminating the system of double taxation, the GST system eliminates the multiple state and central taxes businesses had to pay. Previously, companies had to pay as much as 32 per cent in taxes. Under the GSTs system, they pay just between per cent. Hence the tax filing process has become much more straightforward for small businesses.
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