GST - A Year of Roller Coaster Ride

During the last one year we have seen a roller coaster ride in implementation of GST. The new regime was started with many hopes like ease of doing business and paperless compliance, however, just after the launch on 1^st July 2017 ,the GST Network portal started showing hiccups and did not allow smooth operation of the routine procedures like registrations, returns etc. with the same effortlessness which the economy expected in comparison to the existing VAT, Central excise and Service Tax laws .  A low  operating speed delayed operation of return filings, stricter deadlines proposed, unclear transition provisions for smoother switch-over into new regime, was a direct result of awful implementation of the biggest tax reform the nation saw.  

 Due to the lacunas and poor implementation,  the businesses especially the medium and small businessman started feeling the pinch for not being able to get through the system, as  no hand holding process was  initiated by the Government. A soft launch was what was expected from the Government; however a harsh law with multiple penalties greeted the public.

Majority of the daily  and common use , essential items were kept in the bracket of 28% of GST levy and even the existing non-taxable items were under the taxable category, thereby making holes in the pocket of a common man.

It was only after the intervention of the Hon’ble Prime Minister himself, the GST Council, Finance Minister and his team fastened their belts and  attempted to gel in easing tedious provisions with practical issues to ensure that major relief is given to a common man. This  timely intervention brought in removal of majority of the items from highest tax levy to the lower tax bracket, taxability of transactions from unregistered under reverse charge mechanism, delay of the proposed e-way bill compliance etc. Therefore today we see that more than 95% of the consumer products are “at or under” 18% GST levy and majority of the household as well as food items are under exempted category. This could have been done right from the day one to bring in confidence in the economy and its people .

Now Government orders the officers of the State as well as the Centre now after almost a year for revamp the current return problems by introducing a single simple return to do away with complicated process and clear the bottlenecks.

The only positive take away which needs  to be appreciated is that the federal system of the country which is the principle behind the GST Council  stands united beyond any doubt. The positive side of GST is that it was successful in the attempt to bring the online single indirect tax levy on track bringing in more transparency and curbing the rampant corruption as it  drastically reduced discretion powers to the offices. The time bound provisions of the law even stretched the officials and legal machinery to be on their toes to act and work in the interest of the nation.