GST Implementation to Realize ‘Make in India’ - V S Krishnan, CBEC
“India is on cusp of most important post-independence reform which needs a strong political will for the last mile implementation”, said Mr V S Krishnan, Member, Central Board of Excise & Customs speaking at Interactive Session on Enhancing Competitiveness of Indian Business organized by Confederation of Indian Industry (CII) . Mr Krishnan mentioned that Goods and Service Tax (GST) once implemented will boost the GDP growth by 1-2%. It will have a major impact on reducing logistics cost which is around 14-15% in India as compared to the world average of 7%. GST will facilitate in removing interstate barriers boosting interstate trade in volumes and with simplification in tax procedures will increase tax revenues. Organised manufacturing will be the biggest gainer from GST as the latter will create a level playing field between imports and Indian manufacturing and help realize the vision of ‘Make in India’. GST will also bring in substantial reduction in non-compliance in the trading sector bringing the trading and manufacturing at par and increasing competitiveness.
"The remarkable part of the GST journey is the impressive convergence between states on a host of issues. I would suggest industry to look at critical exemptions and IT platform readiness rather than stressing too much on date of GST implementation as this can hamper preparedness" said Mr Krishnan. Stating the 3 crucial areas of GST, Mr Krishnan mentioned the first as ‘Rate’. He said that the standing committee of the Rajya Sabha has said that the rate should be not more than 20% and that more clarity will be given soon. The second aspect is ‘Technology’ under which GSTN (Goods & Service Tax Network) will be one of the biggest IT projects in India, which will be bring central and state government on one single platform and help in matching supplier and purchaser details. Speaking about ‘Law’ as the third key area, he said that the GST law is in place and on approval would be made available in public domain. Mr Krishnan asserted that new institutions with dedicated GST secretariats at State and Centre will be required post the implementation of GST for ensuring ease of doing business.
Mr Ravneet Khurana, Deputy Commissioner, GST highlighted that reduction in multiplicity of taxes, mitigation of cascading/ double taxation, more efficient neutralization of taxes especially for exports, development of common national market, simpler tax regime and conceptual clarity (Goods vs. Services) will be the benefits of the GST to the industry. He also stated that procurement, manufacturing, distribution and supply chain will be the major areas that will be positively impacted for business in GST regime.
Mr Satish Jamdar, Member, CII National Manufacturing Council and Managing Director, Blue Star acknowledged that CBEC is playing an active role in the deliberations in the various Committees constituted by the Empowered Committee. It is expected to play an equally important role in the drafting of GST law and procedures, particularly the CGST and IGST law. It is also gearing up and preparing in advance for meeting the implementation challenges, which are quite formidable. The number of taxpayers is likely to go up significantly.
29 September 2015