Goods and Services Tax is the biggest move taken by the Government of India which is assumed to bring the worldwide change in the economy of the country. It is expected that GST will give a chance to small businesses to grow economically and built a competitive edge in contrast to other bigger industries. Although the new taxation regime will bring a lot of benefits to the population of India by transforming the ease of doing businesses, it is packed with various challenges as well. There is still a lot of confusion in the market related to the GST registration, taxes levied, provisions, and the tools used for the GST calculations and so on.
In this post, we list five uncertainties faced by common people of India after the GST implementation. Take a look.
1. Plenty of Uncertainties
After the GST implementation, Government and taxpayers need to embrace themselves for a successful GST-rollout. There are still doubts related to the provisions and registration that needs to be sorted out by the Government of India. The Center and State are working out on these issues to resolve the several deadlocks in the new reform. Discussion is still going around about the additional cess or the sin tax on various products including the tobacco and luxury goods. The main issue is that the GST base is ready, however, the toppings are yet to be served. The unpreparedness of GST is creating a difficulty for businesses to sell and purchase goods.
2. NO “One-Nation One-Tax” Rule
As it was promised by the Government that there will be one nation one tax in the country after GST implementation, no such implementation can be seen. The GST framework is meant for State GST and Central GST and this is why the central and state agencies are sharing the jurisdiction over assesses. Previously, the Government used to collect tax separately in the form of State and Center which was going to change after GST implementation. It was expected that GST will bring one nation one tax funda into consideration, however, there is still the division of taxes going on.
3. Multiple Tax Rates
According to the Government of India, after the implementation of India, there will be a uniform tax across the states. Indeed the tax is uniform after the successful implementation of GST, but, the tax structure has distributed differently. The GST council has introduced the tax structure according to the four tier slab which includes taxes in the form of 5%, 12%, 18% and 28%. These slabs has been categorized according to the different commodities. Apart from the tax structure, there are certain essential commodities that are exempted from paying these taxes including the food grains.
4. Destination-Based Taxation
One of the major issue that took place after the GST implementation is that of destination-based taxation. The tax-levy mechanism has totally changed due to which business powers are facing issues. Previously, the taxes were levied on the basis of origin whereas now under the GST-compliance, the tax are levied on the basis of destination. GST is a tax which is totally destination-based or consumption based. Therefore, the place of consumption decide from which state the tax needs to be collected. This will be an opportunity for the less developed states which consumes more rather than what they produce.
5. IT Infrastructure for GST
A completely update IT infrastructure needs for the GST in order to upload the data from the entire country. It should be stable, secure and able to maintain the database properly. It is because everything has gone online after the GST-rollout. The Government has facilitated the population of India by launching a web portal for all the rules, laws and latest GST news. If any person wants to get information regarding enrollment, filing returns and registration, he or she can go through the website. However, the main issue is that, the website is still not clear and that’s the reason Government has appointed GSPs and ASPs to make their own gateway for payment of taxes and filing of returns.
After the GST roll-out, these are the issues that general population of India are facing which needs to be sorted out quickly. The reason behind, it can create a lot more issues in future. Apart from getting into the issues, makes sure that everyone get registered into the new taxation system which is equally important. To know more about the current provision it’s advisable to go through the authentic GST news.