Mindset Which Cannot Accept Change Opposing GST Regime

Mindset Which Cannot Accept Change Opposing GST Regime

I am very positive about GST in spite of the hassles we are facing because of its roll out. Rather than procrastinating for perfection, the decision to roll out GST and then fix the red flags on the way was a brave decision by the FM. With multiple political parties ruling at the Centre and states, had he waited to iron out all issues and generate 360-degree consensus, GST would never have happened.

Even when VAT was rolled out in 2005, we had many challenges and pain points. It was not that the Act was unclear; it was our understanding that was lacking. Now GST has been rolled out and everyone is interpreting the Act, but nobody has complete clarity.

Any new idea faces an acceptance hurdle. In my view, Indians by nature resist change. In the 70s people were hesitant to enter a textile shop which was air conditioned thinking it will be pricey. Today you cannot imagine a shop without AC. Even when computers came in for the first time, there was resistance. The real problem is the mindset which cannot accept change.

Some of the major concerns raised:

- Mismatch of Input Tax Credit:

Under the GST regime traders are required to match the Purchases to claim Input Tax Credit. This may lead to problems in availing the same if the counter party doesn’t correctly upload their returns or remit taxes (This issue existed in the VAT regime also).

-Loss of Input Tax Credit: Input Tax Credit cannot be claimed on expenses incurred in another state if the state of billing is different from the state in which the expense is incurred.