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The ‘one nation, one tax’ vision of the government, has been fairly accomplished with the implementation of GST. The GST council has also been making regular changes to the taxation laws to meet the needs of businesses better. Some key changes that businesses can expect from GST in the near future are discussed in this post.
It has been two years since GST was implemented in India. While there have been several ups and downs, it is not wrong to say that the new tax regime has helped several industries in many different ways. Apart from achieving its ‘one nation, one tax’ vision, the government also wanted to make taxation easier for business with the introduction of GST.
To keep up with the needs of businesses, the GST council has also been making regular changes to the taxation laws and several more of them are expected in the future. With the NDA government back in power again and a new Finance Minister, what are some of the most important changes that businesses can expect from GST? A few of them are discussed below-
- Major compliance reform
One of the biggest problems with GST, as soon as it was implemented, was the compliance process. The government wanted to make the entire taxation process digital, and thus, almost every aspect related to GST needs to be done online. However, the online GST platform still continues to struggle with glitches even after two years.
Even the filing process that was put in place initially had to be quickly abandoned, as businesses were struggling with the compliance process. A large number of business owners have also been complaining that the GSTR filing is time-consuming and is not leaving them with enough time to manage their business operations.
A glitch-free GST platform with faster and easier returns form is one of the most important things that businesses can expect from GST.
- Easier refunds for exporters
The refund process for exporters is a complicated one. GST has introduced several new governing procedures, including data matching law that have severely impacted the exporting business in India. This is especially true for smaller exporters, who often, do not have the resources that can be spent on taking care of the refund process and other aspects of GST.
While the GST council has tried to make amends, exporters continue to struggle. Going forward, some major changes are expected with regards to exporters and their refund process.
- Preventing working capital blockage
A prevalent problem for small businesses due to GST is the liquidity crunch. In the new tax regime, the tax department maintains an electronic credit ledger which records all the tax liabilities of businesses.
Due to this, an increasing number of small businesses are struggling with the liquidity crunch. As per a 2018 report, the government owed more than Rs. 50,000 to small businesses. The government is currently working on an electronic wallet system to speed up this process and prevent blockage of working capital for business.
- Improved e-way bill
The e-way bill was introduced with great fanfare in 2018. The bill had the potential to eliminate the major obstructions related to interstate transport. But as soon as the bill went live on the GST portal, the platform crashed as it was not able to handle the large volume of requests for e-way bills. Soon after, the GST council rolled back the e-way bill and launched it again a few days later.
While the GST portal has improved in the last one year, most transport companies still struggle with regards to dealing with the provisions of the bill. For instance, the trucker or transport company is required to generate the e-way bill on their own once it expires.
A large number of truckers are illiterate and are unable to generate bills on their own. The Goods and Services Tax council is considering these concerns and is working to come up with a simplified e-way bill procedure.
Future of GST in India
It is almost impossible to get everything right or satisfy everyone with something as far-reaching as GST. But to keep up with the expectation of businesses as well as the consumers, the GST council is making timely changes to the laws to make them easier and beneficial. For smooth GST migration, a large number of businesses now rely on professional GST advisory services.
From assessing the financial impact of GST, realigning operations to ensure tax efficiency, compliance support, to custom GST training, the advisory services can help a business in many different ways. With the help of such services, businesses can ensure a smoother transition to the new tax regime without disrupting their day-to-day business operations.
