What SMBs Should Know About GST | SupportBiz
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What SMBs Should Know About GST

 
Tags: Alankit, GST
The GST system will provide linkage to all State/UT Commercial Tax departments, Central Tax authorities, Taxpayers, Banks and other stakeholders. It will be a common medium of information sharing with standardized forms, formats, payment ‘challans’, acknowledgements, certificates etc.

Perhaps one of the most important economic reforms in the country, the implementation of GST lays ahead a potential opportunity for India to reshape and restructure its corporate landscape in more ways than one. In an economy developing as rapidly as India, GST will bring about a paradigm-shift in India’s global perception and operations. While harmonizing the current tax structure, simplification and transparency in processes remains the core intent of the bill, the impact reaches far beyond. The implementation of GST addresses several pressing issues such as multiplicity of taxes at the central and the state level, lack of uniformity, double taxation and tax cascading issues such as No cenvat credit of excise duty to VAT/CST dealer, No credit of entry tax, entertainment tax etc.

The GST system will provide linkage to all State/UT Commercial Tax departments, Central Tax authorities, Taxpayers, Banks and other stakeholders. It will be a common medium of information sharing with standardized forms, formats, payment ‘challans’, acknowledgements, certificates etc.

 

The impact of GST on Consumers and Businesses

For SMBs in India, the impact of GST is likely to be positive. We anticipate some fundamental changes in how businesses operate in the country; not only will GST help streamline processes, make them smoother and uniform but also shorten and improvise several cumbersome tasks. For beginners, it will help develop a common national market and take care of disputes between manufacturing and process. It will reduce the number of taxation layers and departments. From a logistics standpoint, it will allow free movement of transport, aided by no entry tax or road permits.  On the back of common exemptions between central and state taxes, GST will create a level playing field for businesses in Indian and increase competitiveness.  

With the implementation of GST, consumers will be liable to pay a single and transparent tax, proportionate to the value of goods and services. Reduction in multiplicity of taxes is also a great advantage for consumers. Cost of tax collection and filing both will be reduced by filing through online channels and tax on tax will totally be eliminated.

In conclusion, we can say that GST is one tax that can be a major breakthrough in the Indian taxation system.

 

Consumer and Business Readiness (specifically for GST)

We see that various stakeholders are at different stages of GST preparedness. While large enterprises have expert help at hand, and are getting ready for GST, SMEs, and informal businesses, biggest, and critical segment of stakeholders, are 'in waiting' for when GST will be announced on July 1. GST literacy and training is the first key challenge. With one third of existing registrants are  yet to 'migrate' to GSTN portal, there might be some foreseeable delay in the official processes.  

GSTN portal is slated to commence 'trial' in a few days, and we are hopeful for it to see the impact soon. In a week from today, GSTCouncil is taking up a difficult challenge of fitment of various items into different tax slabs, and we hope for the best. Several state legislatures have already passed respective SGST law and others are expected to do so by end May, 2017.

 

The role of Alankit as a GSP

GSPs enable the taxpayer to comply with the provisions of GST law through their web platform. Alankit as a GSP is thoroughly prepared to provide innovative and convenient methods for taxpayers and other stakeholders to interact with the GST Systems, from entity registration to uploading of invoice details and filing returns.

The interface and features exposed by the GST portal will be uniform for all taxpayers and might be basic in form and design. On the other hand, GSPs are expected to have the richer interfaces and features required by specific groups of taxpayers (large taxpayers with completely automated financial systems, SME with semi-automated systems, and small size with no system). Also, by sheer size the GST portal will not be as nimble as that provided by a GSP. GSPs can come up with the applications needed to provide GST filing facility in existing software, or they can develop end-to-end solutions for SME and small taxpayers to manage their sale/purchase and GST filing.

Similarly, for Tax Consultants, GSPs can provide a dashboard to display lists of his/her clients, and clicking on a particular client can give tax consultants a snapshot of the client’s actions/ pending actions. GSPs can also provide innovative value-added features, which would distinguish them from other GSPs in the market.

Alankit Limited is a qualified GSP (GST Suvidha Provider) as appointed by GSTN among the 34 shortlisted companies. Alankit limited will develop the web or mobile-based interfaces for taxpayers to interact with the GST network .

Alankit as a GSP is responsible for providing IT infrastructure (portal) through its IT partners i.e. ASPs and we are already in the process of appointing of ASPs.