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As implementation of GST completes seven years in a few months, it is important for us to
focus on reform areas, to plug revenue leakage. An important reform is to stop the
composition scheme & convert all the businesses under composition scheme to regular GST traders. This is important because composition scheme was introduced to reduce the compliance burden on small traders. But under this very pretext these businesses are short circuiting the customers by not issuing proper bills. This is causing a huge revenue leakage as all the transactions are not recorded. We must learn from our experience in implementation of GST law & simplify the procedure to reduce the compliance burden. In the garb of compliance, traders should not indulge in unhealthy practices. Even after so many years, the opposition to GST is because many of the businesses irrespective of size do not want to play by the book.
The government by using the latest technology tools can continuously monitor the
revenue leakage & reduce the compliance burden over a period resulting in growth in
revenue.
Further in the case of regular GST traders, the government is abdicating its responsibility
of adequately penalizing the regular GST suppliers who repeatedly fail to file GST returns on time resulting in buyers not being able to claim input tax credit on time resulting in enhanced working capital requirements. Also, government is outsourcing it’s role of monitoring, by asking the buyers to follow up with their suppliers to file timely returns. Once the buyer purchases goods from a registered GST supplier, the government must devise a system to authenticate the Invoice & allow the buyer to claim input tax in time thereby easing the working capital requirement.
The above steps will go a long way in streamlining the GST system leading to enhanced
compliance & desired revenue growth.
These pieces are being published as they have been received – they have not been edited/fact-checked by ThePrint