It will take a year for the Goods and Services Tax (GST) to show “satisfactory results”, minister of state for finance Shiv Pratap Shukla said on Saturday, a day after the GST Council slashed rates on a range of items and sought to make compliance easier for small and medium businesses.
“Don’t assess us on the basis of these three months… it will take a year for it (GST) to show satisfactory results,” Shukla said at the National Conclave on GST, hosted by the PHD Chamber of Commerce and Industry (PHDCCI) in the capital.
The event saw around 350 experts, industrialists and government officials engaging in discussions on GST, the challenges faced by small traders and exporters, and reflecting upon their experiences with the new tax system so far.
Among the key concerns discussed was the 28 per cent tax slab on certain goods, which is considered to be high and unsustainable. Shukla assured that the GST Council would continue to rationalise the rates. “The highest tax slab of 28 per cent will be gradually brought down,” he said.
Speaking to ThePrint on the sidelines of the event, Haryana’s finance minister Capt. Abhimanyu said that the central government had tried to ensure that the new rates were lesser than those in the previous tax system. “This 28 per cent slab is essentially for luxury goods,” he added.
Mahender Singh, member of the Central Board of Excise and Customs, spoke on the issue of difficulty of availing input credit by traders. He said, “The money expected has not come to the government; government coffers are empty. In a such a situation, it wasn’t possible to pass on the credit.”
Bimal Jain, chairman, Indirect Taxes Committee, PHD Chamber of Commerce, said there was no official notification regarding excise exemptions for hill-states such as Uttarakhand and Himachal Pradesh. He wondered whether these states, which were enjoying excise exemptions in the pre-GST era, would continue to enjoy the relief or not.
In the ‘open house’ session, many industrialists stressed on the need for better inclusion of small-scale businesses, which have no access to computers, in the GST network. The need for better communication and overcoming language barriers were also discussed.
Highlighting the fact that the GST network has not covered small towns, Praveen Khandewal, secretary general, Confederation of All India Traders, said “GST has arrived in India, but not in Bharat”.
Technical problems in accessing the GSTN portal, need for a support system as well as a better grievance redressal mechanism were also raised at the conclave.
Capt. Abhimanyu assured that GST was on the right track. “More than 90 per cent of returns for July have been filed. The performance in the first quarter has been very satisfactory. I believe that by the end of this financial year, there will be a complete transition to the new tax system across India. Then we can work on improving the model.”
ThePrint was the Digital Media Partner of the GST conclave.