KCCI hosts Goods and Service Tax (GST) Awareness Programme
Mangaluru: Goods and service Tax (GST) is the single largest tax reform in India since Independence. It is a comprehensive tax on manufacture, sale, supply, transfer, barter, exchange, license, rental, lease, disposal, import and consumption of goods and service across India. In effect, GST will combine 16 taxes including excise, service tax,VAT, and other local body taxes into one broad framework. For any given commodity, the rate of tax will remain the same throughout the country which also means that there won’t be any state borders as far as business is concerned.
In order to ensure that you move smoothly into the GST era, you must- Understand the difference between the present tax laws and GST; Understand the importance of computerization in the GST era; Understand the importance of maintaining your accounts properly; Comply with GST to make sure that you a business advantage in the market; these and many more advantages of GST were discussed during the GST Awareness Programme held at KCCI Meeting Hall on Wednesday, 30 November from 10 am-5pm hosted by Kanara Chamber of Commerce and Industry (KCCI).
After welcoming the gathering by Jeevan Saldanha-President of KCCI, and introduction of the Chief guest- Ritvik Pandey (IAS), Commissioner of Commercial Taxes, Govt. of Karnataka, Bengaluru, and Guest of Honor-Jai Kumar Garg- MD and CEO of Corporation Bank, Mangaluru by Smt Vathika Pai- VP of KCCI, the programme was inaugurated by lighting the traditional lamp by the Chief Guest along with other dignitaries namely-the guest of Honor-Jai Kumar Garg, BA Naniappa- Jt Commissioner (Commercial Taxes), KM Sulochana- Jt Commissioner (Commercial Taxes), Basavaraj- Jt Commissioner (Commercial Taxes), KG Pavithra- Jt commissioner, Dr Ravi Prasad- the JCCT-Vigilance, Ganesh Bhat- KCCI Treasurer, Vathika Pai- VP-KCCI, CA Nandagopal Shenoy- Chairman, Central State Taxation and VAT Executive Committee of KCCI, PB Abdul Hameed- Hon. secretary-KCCI and Jeevan Saldanha- President, KCCI.
Addressing the gathering chief guest Ritvik Pandey spoke on the benefits of the implementation of GST, where he said, “The implementation of GST is one of the most significant reforms affecting all factors of production and economics. The implementation of a unified GST in India is viewed as one of the most far-reaching indirect tax reforms that the country will see. Currently under the constitution, while the Union government is constrained from levying taxes on goods beyond the point of manufacturing, state governments cannot levy taxes on services. Thus, to simplify and unify the current indirect tax structure, an amendment to the current constitution is needed. The implementation of a unified and simplified GST through constitutional amendment could overhaul the current indirect tax system of India.”
“GST is a consumption tax that is collected on sale of manufactured goods and services. Since it is a consumption tax it is passed on until the last stage, wherein the customer bears the tax, just like excise duty is imposed currently. What makes GST an important tax reform is it simplifies the tax structure, increases tax compliance, increases government revenue and integrates states. The current taxation system creates borders within borders in the country, as the system is unable to provide tax credits for interstate transactions, and this leads to distortions in the allocation of resources. In this context, one of the most important benefits of implementing the GST is that it would integrate the economy and provide for a common national market. Corporate sectors’ decisions to set up production operations would be influenced not by tax benefits but on core business efficiency ” added Pandey.
He further said, ” What will be the impact of GST on the economy? Analysts say that after an initial increase in inflation, which will be transitory in nature, growth should kick in. GST would drive up headline CPI inflation by 20-70 basis points in the first year due to higher prices of electricity, clothing & footwear, health/medicine, and education after accounting for input taxes and potential asymmetric pricing behaviour by firms where tax increases may be quickly passed on to output prices, while firms refrain from fully passing-on tax savings to consumers. However, in the long term, lower tax and logistic costs, productivity gains and higher investments under the GST should structurally reduce inflation. Market is betting on growth that GST is expected to bring in. The overall impact of better allocation of resources, improving efficiency of domestic production and exports is likely to improve overall growth”.
“Which sectors and companies will gain the most if GST gets implemented? Four of the ten sectors evaluated would benefit from GST implementation. Consumption (warehousing consolidation), logistics (more movement of heavy vehicles), house building materials (lower duties), and industrial manufacturing would likely experience a positive impact; oil & gas could see a negative impact, while cigarettes could see a negative impact only if overall tax incidence goes up, which may be a low-probability event. The remaining sectors would likely see a neutral impact. GST is surely a big advantage for business owners/traders and like wise” said Pandey.
Speaking on demonetization and core-banking, Jai Kumar Garg said, ” After demonetization, the bank has seen huge deposits, and we are all ready to handle any issues pertaining to demonetization. Corporation Bank has collected Rs 9,893 crore in Rs 500 and Rs 1,000 demonetized currencies, between November 10 and 12. The bank has exchanged banned currencies worth Rs 632 crore in just those three days. The situation will ease soon and there will be no heavy rush thereafter. By December 30, customers will be able to get full service and there will be no rush, when the new Rs 500 currency notes arrive, the ATMs have to be calibrated with a small procedure.”
Regarding problems being faced by farmers in the interiors, Garg said, “Our bank has business correspondents in all rural areas. Farmers can do business transactions through micro ATMs there. Indian economy is growing-there are various factors contributing for the development of economy. Change in IT and faster growth has changed the banking operations to a great extent. Banking operations have led to a great development of economy and meeting customer’s needs. Among various sectors that bank is involved , Core Banking is one area that has changed gradually in meeting dynamic needs of the customers”.
PB Abdul Hameed – the Hon. secretary of KCCI proposed the vote of thanks of the formal programme, which was followed by technical sessions, namely-Concept of Supply, Place of Supply and Job Work; and GSTN Migration and PAN Updating by Basavaraj; Valuation and Transitional Provisions by Dr Ravi Prasad MP. The moderator for the sessions was CA Collin Rodrigues- committee member of KCCI.
