On completion of 3 years of GST in India, the Confederation of All India Traders (CAIT) while paying its respects to Shri Arun Jaitley who laid the foundation of GST implementation in the Country and complementing the Prime Minister Shri Narendra Modi for his vision of ease of doing business said that GST is still at nascent stage and it requires two more years to become a stable taxation system and if the GST Council confers with stakeholders, the number of assessees under GST can be increased to 2 crore. The CAIT appreciated the soft approach of the Central Government in implementation of GST in India.
In a letter sent to Finance Minister Mrs. Nirmala Sithraman today, the CAIT said that GST Council under the leadership of Finance Minister earlier Mr. Jaitley and now Mrs. Sithraman has done a commendable work and the best part is the open mind of the Central Government to keep amendments happening in Act, Rules & Regulations from time to time which has simplified the taxation system to a great extent but still much more is required to widen the tax base, improvement in revenue collection, removal of glitches to take views quite off and on and bringing several changes in the Act, Rules & Regulations, ways & means to simplify the system, removal of technical glitches, avoidance of penal actions except on wilful avoidance of tax and make attempts to encourage more and more people to embrace GST taxation system. The fear of GST cobweb is needed to be removed. The CAIT has assured the Finance Minister of utmost cooperation from the trading community.
CAIT National President Mr. B.C.Bhartia & Secretary General Mr. Praveen Khandelwal in letter to Mrs. Sithraman said that continuous and repeated notifications & circulars issued by Authorities on GST is confusing the traders and even the technical experts are unable to cope up with the repeated changes. Calling for a Technical Audit of the backend operation of the GST system, they said that initially three GSTR Forms were introduced; however, due to technical issues till date those forms never became a reality and a new Form GSTR-3B had to be introduced. So technical audits should be done at regular intervals and the technical team should be given proper training about the law to make the system glitch free. They further said that the purpose of bringing the GST was seamless credit of the input tax, however, section 17(5) puts a lot of restrictions on the same which adds to the cost of the goods and services supplied. To make business competitive, it is suggested that any expenditure which is allowable and acceptable as business expenditure whether revenue or capital, the tax paid on the same should be allowed as input tax credit unconditionally .
Mr. Bhartia and Mr. Khandelwal said that the system is plagued with a most important issue of levy of tax liability on purchasing dealer again in cases where although the purchasing dealer has paid the tax but in absence of non-filing of return by the selling dealer, the purchasing dealer is liable to pay the tax again. This provision is much against the principle of natural justice and therefore needs a corrective action.The issue of late fee is harassing the traders to a great extent. Recently, the Department issued a Notification No.52/2020 dated 24.6.20 which levies heavy penalty on the traders who have failed to file return due to lockdown.
The Government has to distinguish between intentional and unintentional while prescribing any penal action. They further said that lot of advance rulings are passed by various states on the same issue with contrary opinion which is creating a problem to do business interstate as in one state follows one ruling and the other state follows other ruling so to come to consensus on any issue, formation of National Advance Ruling Tribunal at earliest is warranted which is pending since last 3 years.
Both Mr. Bhartia & Mr. Khandelwal said that there is a need to constitute a Joint Committee of senior officials and representative of trade at each District level under the Chairmanship of District Collector which should be assigned the work to monitor and regulate the GST functioning in the State, remedial measures for traders issues, augmentation of revenue and widening of the tax base having a conciliatory approach. Most of the issues will be settled at District level and there will be no need for the traders to run from State to Centre for matters other than policy. The limit of E way Bill should be increased, Instead of monthly returns, there should be a quarterly return for all assesses but the tax can be paid monthly, provision of revised return should be introduced.
The trade leaders also said that classification of goods under different tax slabs should be reviewed now as there is overlapping and disparities on tax rates on many items, 28% tax slab should be reserved only for luxury goods, items pertaining to raw material should be kept in lowest tax slab, the daily use items may be classified in either lowest slab or one slab higher than the lower slab depending upon usage of goods.