Economy

'Plenty of hiccups' expected with the arrival of biggest tax reform'

'Plenty of hiccups' expected with the arrival of biggest tax reform'”

"We are not ready", said K.E. Raghunathan, a Chennai-based business owner and president of the All India Manufacturers Association.

"It's like the day after demonetization." said Praveen Arora, 35, who runs AVM Computer at Nehru Place in the capital New Delhi, referring to the government's sudden decision in November past year to withdraw 86 percent of the country's currency from circulation. "The credit for the new law does not go to one party or one government but was a shared legacy of all", he said.

Pointing out three shortcomings, Kumar said, "Traders whose turnover is more than Rs 20 lakh will have to file the tax return every month. It will help in containing black money and corruption", he said. "But the complications have definitely increased and we are working on them", said Bhumit Seth of Arihant Steel, another MSME that supplies to tyre and oil industries.

Distributors of steel used to pay close to 18% in taxes with the imposition of 12.5% excise as well as 5% VAT.

Overall, the GST scheme aims to simplify India's labyrinth of almost a dozen state and federal taxes that often led to long queues at state borders for truck drivers who had to pay different taxes for the goods they were shipping. "It is a result of our collective efforts", Modi said, speaking in Parliament during a special function to launch the GST. It highlights the fact that India can rise above narrow politics and work for country's benefit.

GST will chart new course for nation. First proposed in 2003, the idea of GST was bogged down for years in bipartisan debate, with political parties in government trying to push it and those in opposition dragging it down.

He recalled that the Central Hall had been witness to several historic occasions in the past as well, including the first session of the Constituent Assembly, India's independence, and the adoption of the Constitution. "GST brings uniformity in the economic system". This will minimise taxpayers' physical interaction with the tax officials.

When asked if they had complete knowledge of the GST regime, a shopkeeper of CS Electric Company here said that the information available online was helping him make bills. Also, the Electronics showrooms have announced GST clearance sales offering up to 50% off on TVs, mobiles, laptops, air conditioners etc. Similarly, exporters will get refund within seven days. "GST will give all the states the chance to progress equally".



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