Arjuna (Fictional Character): Krishna, what can you say about completion of 1 year of GST implementation?
Krishna (Fictional Character): Arjuna, GST now completes 1 year in India, this year has been tough for everyone. The biggest Tax reform in India is now slowly being accepted by all. Still there are many changes which are yet to come and that may be trouble for some while blessing for some.
Arjuna: Krishna, What trouble has GST brought?
Krishna: Arjuna, Trouble in GST means the problems that are faced by tax practitioners and Tax payers-
1. The rate of Service tax was 15% but in GST the rate of services is 18% which has made services costly.
2. GST was implemented in the middle of a financial year due to which there was a period of pre-GST and post-GST in the same financial year.
3. This was the first year of GST but still there is no provision of Revised GST return.
4. There are technical glitches in the GSTN network due to which return filing on time has been made.
5. There are many problems faced by taxpayer while generating E-Way bill.
6. As per Section 9(4), for the purpose of Reverse Charge mechanism each and every person had to keep record of daily transactions and the credit of reverse charge could be availed in the next month due to which working capital was blocked.
7. Taxpayers who did not register in GST made loopholes for tax planning.
8. Due to frequent changes in GST, Tax practitioners and Tax payers had trouble to file returns.
9. If payment is not made within 180 days then the credit will be reversed, and credit can be availed after full payment, due to this provision books had to be updated.
10. Refund of IGST in case of exports is not very easy task.
Arjuna: Krishna, What are the provisions that came as a blessing?
Krishna: Arjuna, There is positivity when there are positive vibes, the positives of GST are-
1. Tension of Taxpayers to follow 17 various laws has been reduced and now there is only one law.
2. There is only one rate of tax due to which prices of various commodities have become stable.
3. Double taxation i.e cascading effect has been removed
4. Due to one nation one tax, nation vide market has been stabilized.
5. Due to seamless ITC, ITC on goods can be taken irrespective from where the goods are purchased.
6. Bill wise tracing can now be done because many taxpayers are now filing their returns and transparency has increased due to matching and mismatching of returns.
7. This change was necessary to bring development in the under developed states.
8. Interaction with tax officers has reduced n GST due to online portal.
9. GST has reduced corruption.
10. From 1st July 2018, E-Way bill limit has been increased from Rs 50,000 to Rs 1,00,000 for intra state transactions i.e within Maharashtra transactions and there is no need for generating E-Way bill for fabric Job Work.
Arjuna: Krishna, What more changes can be expected?
Krishna: Arjuna, Bringing in revised return in GST is a necessity. Also training the taxpayers in GST is a must. The technical glitches on GSTN network also has to be removed.
Arjuna: Krishna, What lesson the taxpayer should take from this?
Krishna: Arjuna, GST is still in its implementation stage, still many changes are yet to come. Infrastructure for purchases, returns portal, etc is still under development. When the infrastructure would develop, then only opinion about GST being a blessing or bane can be made.