With the passing of 2018, the Indian trading community hoped for a sustained, simplified and rationalised Goods & Services Tax (GST) in the year 2019, and if the focus of both the Central and state governments is circled around mitigating the genuine difficulties of the traders, the GST will prove to be a trader-friendly taxation system. This was stated by the Confederation of All India Traders (CAIT).
“However, to encourage more and more traders to adopt the GST taxation system, it will be more appropriate if certain tax benefits in GST are given to traders for collecting tax revenue,” it added.
Summarising the year-long events in GST, Praveen Khandelwal, secretary general, CAIT, said, “The year 2018 remained normal for the trading community though being the initial year, traders across the country faced many difficulties including glitches in the GST portal, irrational classification of goods in different tax slabs, a complicated tax procedure, non-availability of refunds from the tax authorities, complicated return forms, etc.”
Khandelwal added that the new indirect tax regime is good in one sense for the traders, as it would relieve them from the onerous task of filing too many papers, complying with various taxes, interaction with officials from various departments and also rescuing them from the decades-old clutches of inspectors.
However, only 35 per cent of the trading community having computers is a major compliance issue. Further, the lack of awareness about the GST law, rules and regulations among the trading community is a big challenge, which needs to be looked into in order to generate more voluntary compliance of GST in the country.
Khandelwal said, “Since GST is a indirect tax regime, the final tax has to be paid by the consumer, and undoubtedly, traders are the only contact with the consumers, and as such, the major responsibility of collecting tax is devolved upon the traders and they have a major role to play for a successful GST tax regime.”
As such, the support of trade associations across the country is crucial to penetrate GST down the line. It is suggested that a nationwide awareness campaign should be launched by the government with support of trade associations all over the country.
At the district level, a GST joint committee should be constituted, with officials and trade leaders as members. Subsidies should be provided by the government to empower the traders with computerisation in order to ensure better compliance.
Khandelwal hoped that a proposed single-page return will enable the traders to file return on their own, without being dependent upon a chartered accountant or tax consultant. It will encourage more and better compliance and the revenue base will increase tremendously.
GST has certainly formalised the economy to an extent. If GST procedures are made simple and traders are not unnecessarily harassed or victimised, it will inculcate confidence among the trading community about the levy, and more and more people will come under formal economy. There are about seven crore small businesses across the country and approximately half of them can be brought under GST, if it is a trader-friendly tax regime.
