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Simplify GST, trader body tells PM, says penalty system has brought ‘tax terrorism’ to country

Confederation of All India Traders writes to PM Modi, says GST Council has made GST a complicated tax system, and it violates PM's principle of 'Minimum Government, Maximum Governance'.

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New Delhi: The Confederation of All India Traders (CAIT) has written a letter to Prime Minister Narendra Modi seeking his intervention on the issue of Goods & Services Tax (GST) and streamlining e-commerce rules and policies.

The traders’ body has already announced a “Bharat Vyapar Bandh” on 26 February on issues “pertaining to complicated GST taxation system and vitiated e-commerce market”.

In its letter, the confederation has sought the PM’s “immediate intervention to simplify GST taxation system and streamlining the e-commerce rules and policies to save the domestic trade from the clutches of malpractices of big e-commerce companies”.

The CAIT has also appealed to PM Modi to “break the unholy nexus between Banks and e-commerce companies who are co-partners in violation of the law and policy of the government”.

CAIT national president B.C. Bhartia and secretary general Praveen Khandelwal highlighted the fact that in their discussions with late Union minister Arun Jaitely, prior to the implementation of GST, they were assured that it would end the “woes and suffering” of traders and that they would be required to upload their sales statements on GST portal only once.

Bhartia and Khandelwal said they were told that the other things would be auto-populated by the GST portal to facilitate the traders to comply with the law in the easiest manner and would give them sufficient time to focus on growth of their businesses.

“Much against the public announcements on GST, the GST Council has made the GST as the most complicated tax system which runs contrary to “ease of doing business” mandate of the government,” said Khandelwal.

‘Tax terrorism’

The traders’ body has also alleged that while making amendments in GST rules, the mission statement of PM Modi for ‘Minimum Government, Maximum Governance’ has been highly violated by giving arbitrary and unfettered powers to the authorities to the extent that issuance of show cause notice and opportunity of hearing has been denied before taking any action against alleged offence by traders.

Prescribing huge penalties even for a small error has brought ‘tax terrorism’ in the country and caused discouragement to honest tax collectors, it said.

“Though the GST Council has revised GST rules hundred of times but not even a single opportunity is given traders to revise the GST returns. The difference between “error” and “evasion” needs to be defined and spelled out very clearly and without any ambiguity,” it said.

Khandelwal also said that exemplary punishment should be given to tax evaders and people indulging in fake invoices.

“Such people are a cause of threat to businesses of honest traders who are complying with the law.”

Also read: GST revenue at all-time high of Rs 1.20 lakh crore in January 2021, says finance ministry

Special working group

CAIT has suggested the formation of a “special working group” at the central level consisting of senior officials and representatives of CAIT and independent tax experts to review the GST tax structure and make recommendations to the government for making it a “Good & Simple Tax” system.

It has also suggested the formation of a “District GST working Group” of senior tax officials and representatives of CAIT in each district to monitor smooth GST implementation and take steps for widening of tax base and augmentation of revenue in respective districts across the country.

CAIT accused big giants for “greatly vitiating the e-commerce market” by continuously and openly violating the FDI policy, law and rules without any fear of law by indulging in predatory pricing, deep discounting, loss funding, controlling inventory, sale of branded products exclusively on their respective portals, among others.

“These companies have resorted to innovative but a clandestine structure to violate the policy and are trying to become the second edition of the East India Company,” it said.

The CAIT, meanwhile, appreciated the steps taken by Commerce Minister Piyush Goyal who, it said, has not only warned such companies to stop playing with the rules but has also taken various steps to ensure that law prevails. However, it alleged that several government and private sector banks are colluding with these e-commerce giants and helping them to create an uneven level playing field much against the intention and policy of the government.

Also read: Dream Budget, silenced critics — the rebirth of Nirmala Sitharaman


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  1. GST has been made such a complex law by amendmending the law recklessly at the instance of bureaucrats, whose only goal is to usurp more power, so that they can seek rent from the taxpayers. Media is not paying attention to the fact that under GST law, The amendments have nothing to do with the principles governing GST. Amendments are made more often to overcome court judgments which are favourable to the taxpayers. Taxmen are steadily given more and more power to harass the taxpayers. Most of the time, crooks get away, and the honest taxpayers suffer.

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