Some CXOs, legal eagles see gain in GST, others feel the paingbs17
Service providers, young entrepreneurs and legal experts at the Global Business Summit voiced concerns and expressed hope with regard to the impending indirect tax regime as the parliament discussed the goods and services tax (GST) bills.
Analysing the GST as a combination of the state, central and interstate GST, Bimal Jain, executive director of A2Z Taxcorp, lamented the differential treatment meted out to services under the proposed new indirect tax structure. “Services tax rates will increase to 18% from 15%, and this will reduce the purchasing power of the consumers,” said Jain.
Another pain point which he highlighted was the multiple statewise registrations required for service providers under the GST.
Max India CFO Jatin Khanna concurred with Jain on that. He said litigation with respect to valuation of certain services for tax purposes and the overall compliance cost of GST might be high, which would fly in the face of ease of doing business.
Application Service Providers (ASP) and GSTN Suvidha Providers (GSPs) are part of an indispensable chain to ensure the success of the ‘one nation, one tax’ dream GST wants to accomplish.
Alok Agarwal and Ankit Agarwal of Alankit, spoke of the need to educate people to ensure a smooth transition to GST from July 1.
“Increasing the awareness will help people understand the law and learning to use the goods and services tax network (GSTN) efficiently and will ensure seamless deployment,” said Ankit Agarwal. Sandeep Khurana, CEO of Udyog Software India, an ASP, agreed, saying an efficient software system can help navigate the supposed ambiguities in the law.
Siddhartha Chandurkar, CEO of cloud computing platform ShepHertz, laid the onus on the government to relook at the ambiguous clauses, especially with respect to services and ensure GST is truly a flat tax regime.
Snapdeal CFO Anup Vikal lauded the GST legislation as having finally defined the ‘e-commerce’ space formally. However, he was critical of the tax collection at source clauses made mandatory under the proposed laws. “Majority of our sellers are small and medium enterprises, and deducting tax at source is bound to impact their cash flows.”