The introduction of the Goods and Services Tax (GST) raised much hope that it would herald the emergence of a ‘good and simple tax’ with ‘one nation, one market, one tax’. However, there has been considerable concern with the new tax, both in its structure and operational details, including the ease of paying the tax and filing returns. Trade and industry have been grappling with the problem of payment, filing the returns and claiming input tax credit, and exporters have been facing liquidity crises as the zero-rating of the tax has not worked and refunds have not been forthcoming, with difficulty in filing returns. Of course, the GST Council has been quite responsive to tweak the structure and operational details to make it simpler. Click to read more
A slowdown in tax collections is pushing Prime Minister Narendra Modi’s administration to be more vigilant on compliance.
Collections under the new goods and services tax dipped to Rs 83,300 crore ($13 billion) in October from about Rs 92,000 crore the previous month, and the central bank is wary of a further dip after the government lowered rates on several items to win public support before state elections. The weakness in GST collections following a July 1 roll out has pushed down overall revenue growth. Click to read more
The hurried launch of GST without proper infrastructure in place has made the indirect tax system more “primitive” than the VAT regime, West Bengal Finance Minister Amit Mitra said.
The Centre, he said, is using ledger for manual record of refunds due to lack of interface between the GST network and customs electronic date interchange (EDI) as well as the Directorate General of Foreign Trade (DGFT). Click to read more
The goods and services tax (GST) regime would get stabilised in the next 18 months, Niti Aayog vice chairman Rajiv Kumar said on Friday.
“Give us time and you will see that in the next 18 months, GST will get stabilised, and this is where I think your (chartered accountants or CAs) role is critical,” he said while addressing the southern regional conference of the Institute of Chartered Accountants of India (ICAI) in Bengaluru. “Unfortunately, some of you are trying to scare investors away from GST rather than helping them. I think it is rather unfair,” he added. Click to read more
Rejecting claims that goods and services tax (GST) and demonetisation of old Rs 1000 and Rs 500 notes have permanently slowed down the Indian economy, the International Monetary Fund (IMF) has said that these are just “short-term pain”.
In an interview to CNBC-TV18, an IMF official said that demonetisation and GST has brought “short-term pain but long-term benefits”. He said that IMF expects India’s growth to be 6.7 percent this year and 7.4% next year. Click to read more
The Finance Minister, Arun Jaitley, on Friday introduced in the Lok Sabha a new Bill that seeks to replace the recent GST compensation cess hike ordinance on certain motor vehicles.
It may be recalled that an ordinance — Goods and Services Tax (Compensation to States) Amendment Ordinance 2017— was promulgated on September 2 this year to peg the maximum rate for compensation cess at 25 per cent for motor vehicles falling under heading 8702 and 8703 of the Customs Tariff Act. The maximum compensation cess for such vehicles were earlier pegged at 15 per cent. Click to read more
If there was no demonetisation, the government would have been able to implement the goods and services tax (GST) in a better manner, said Gita Gopinath, professor of international studies and economics at Harvard University, in an interview. She said that among other government reforms, the PSU bank recapitalisation plan and the implementation of the insolvency and bankruptcy code are steps in the right direction. Click to read more
In a move to sustain India’s 7 per cent growth in the country, the Government is focusing on increased investments in infrastructure such as Rs 8.5 lakh crore in Railways and Rs 8 lakh crore under the Sagarmala project and, the recently announced Rs 7 lakh crore in Bharatmala projects.
Currently, almost all these projects are being executed by either private players or Government corporations. In the pre-GST era most of these contracts were categorised as ‘works contracts’ which were overlapping between supply of services and supply of goods, and a combination of service tax and value added taxes (VATs) were applicable. Hence, there was a dichotomy in the applicable indirect tax regime relevant to infrastructure. Click to read more
The opposition in the Lok Sabha today came down heavily on the government over the impact of demonetisation and introduction of the GST, saying the economy was in a bad shape, the growth rate had slowed down and joblessness was growing.
Initiating a debate on the Supplementary Demands for Grants – Second Batch for 2017-18, senior Congress leader M Veerappa Moily said the Prime Minister’s Economic Advisory Council (PMEAC) has “conceded that various reasons had contributed to the slowdown” of the growth rate to 5.7 per cent in the first quarter.
“It is not my allegation but admission on the part of the Economic Advisory Council,” he said. Click to read more