No action should be taken against businesses for 'procedural mistakes' in first 9 months of GST regime: Traders body

Traders body CAIT today suggested the first nine months of GST, from its rollout date of July 1, should be treated as a 'trial period' and no punitive action taken against businesses for 'procedural mistakes' to allow them to get familiarised with the new regime.

Commenting on the outcome of the GST Council meeting that concluded today, CAIT Secretary General Praveen Khandelwal said that classification of goods under different tax slabs of GST are 'by and large' fitted in the correct basket and it is expected that goods will become cheaper under the new indirect tax regime.

"However, on the other side, several items which have been placed under higher category of tax rate will disturb the pricing structure and pinch the common man," said B C Bhartia, president of the Confederation of All India Traders (CAIT).

He pointed out that items like pickles, sauces, and instant mixer pertaining to food processing which are consumed by large number of people, have been placed under the higher tax rate of 18 per cent.

The CAIT further said that while the GST should be implemented from the scheduled date of July 1, the remaining nine months of the current fiscal "may be declared as trial period" and except habitual offenders, no action should be taken against traders for procedural mistakes.

"Let this period be a learning period and a process of rectification may be carried out in order to ensure greater compliance under GST," the traders' body said. It also suggested that items like cement, paint, marble, plywood, and other hardware related to construction should be placed under lower tax slab. The CAIT also said that auto spare parts used for repairs of vehicles and maintenance have been placed under the tax slab of 28 per cent which needs re-consideration.