Welcome pragmatism from gst council

Welcome pragmatism from gst council

The new goods and services tax (GST) will be officially launched on the midnight of June 30 and July 1, but businesses will rightly have two-and-a-half months to comply with the new tax system. Easing compliance is one way to improve industry's preparedness for the transition without an official postponement of GST. The GST Council has been pragmatic to give businesses more time to file their returns in the first two months. Penalties and late fees will be waived during this period, effectively pushing the deadline to September 15. Assessees will only need to file a simplified return based on self-assessment of their tax dues and input tax credit due to them. Self-assessment will help foster compliance -this was done when the Centre first introduced service tax in 1994.
Businesses have also been asked not to panic and rush for migration -they will have a month's time to get their GST identification number. The idea is to assuage businesses, especially the smaller ones, that are ill-prepared for the transition. Companies need time to prepare their accounting systems to draw up an invoice that fully conforms to the requirements of the new tax. This is welcome pragmatism, indeed. The IT infrastructure should be fully functional. The Centre and states must also tie up all the loose ends. The GST Council, for example, has deferred the implementation of the crucial e-way bill to track intrastate and inter-state movement of goods. Reportedly , states will continue with their own system till rules are cleared for an e-way bill to be generated on the portal of GST Network (GSTN), the nodal body to which all producers and suppliers of goods and services will file their tax payments. This means trucks will be stopped at border check posts, leading to undue delays in the movement of goods -and corruption and inspector raj.
The GST Council must swiftly clear the rules for an e-way bill. The anti-profiteering mechanism, with a separate authority to keep a check on the pricing policy of producers, is way too cumbersome. The Competition Commission of India should be allowed to do the job instead.