The "one nation one tax" regime has tackled a slew of challenges including complicated compliance, revisions in tax slabs and alterations in timeline.
As the Goods & Services Tax, touted as the biggest economic reform since independence, completes one year today, the government aims to take the monthly collection to Rs 1 lakh crore. The "one nation one tax" regime has tackled a slew of challenges including complicated compliance, revisions in tax slabs and alterations in timeline. Despite initial hiccups, the implementation has helped government improve ease of doing business in India, broaden the tax base and curb evasion.
The Finance Ministry said the gross GST revenue in April stood at Rs 1.03 lakh crore against a monthly average of Rs 90,000 crore in the July 2017-March 2018 period. A surge in the collection was attributed to the improved economic climate, introduction of E-way bill and improved GST compliance.
The GST Council, the apex body on the indirect tax, during the year was able to unanimously take decisions with regard to evaluation and rationalisation of multiple rates on goods and services in order to curb possible leakages of revenue. Further, the E-Way bill system, which is an electronic ticket for movement of goods worth over Rs 50,000 for distances above 10 km, was successfully implemented from April 1 and difficult procedures of TCS and TDS (tax collected/deducted at source) have been kept in abeyance.
Now the government proposes to introduce new GST return forms from January 1, 2019 after successful beta-testing of the software. Finance Secretary Hasmukh Adhia said the GST Council has already approved the design of new return forms. It was decided that the current system of filing summary returns (GSTR-3B) and final sales return (GSTR-1) would continue for six months. The upcoming GST Council meeting slated for July 21 will decide a timeline for the launch of new return form.
Amid rising chorus for rationalization of GST slabs from various quarter, Bihar Deputy Chief Minister and former chairman of an empowered committee of state finance ministers Sushil Kumar Modi said it will be done after revenue stabilises. Outgoing chief economic adviser Arvind Subramanian, however, has argued that the peak 28 per cent tax slab must go to make GST a less-complicated affair.
Moreover, states have yet to agree to bring petroleum and diesel under GST. Central Board of Indirect Taxes and Customs Chairman Vanaja Sarna has hinted that the GST Council may first bring aviation turbine fuel and natural gas under its ambit and study its benefits like eligibility to avail input tax credit and removal of the cascading effect of taxes.
PwC Partner & Leader Indirect Tax Pratik Jain said GST has empowered the consumers by improving the accessibility of products and a close watch from the government on prices has kept the inflationary trends at bay. ''From industry standpoint, except the initial technological challenges in filings and blockage of funds for exporters, GST has not caused any major disruption. In many cases, there has been a saving of 3 to 5 per cent due to incremental credits and vendor price renegotiation, which can potentially go up further."
From the government's standpoint, Jain said, the revenue collections have been a tad lower than expected. "There is definite expansion in tax base with some visible buoyancy over last few months."
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Now the government proposes to introduce new GST return forms from January 1, 2019 after successful beta-testing of the software. Finance Secretary Hasmukh Adhia said the GST Council has already approved the design of new return forms. It was decided that the current system of filing summary returns (GSTR-3B) and final sales return (GSTR-1) would continue for six months. The upcoming GST Council meeting slated for July 21 will decide a timeline for the launch of new return form.
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