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LATEST NEWS UPDATES | Small businesses grapple with GST compliance -Surabhi

Small businesses grapple with GST compliance -Surabhi

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published Published on Jun 27, 2017   modified Modified on Jun 27, 2017
-The Hindu Business Line

Automating the systems seems to be the biggest challenge

New Delhi:
With less than a week to go for the new indirect tax regime to kick in, small businesses are trying to understand the modalities of the goods and services tax (GST) as the compliance burden for them is set to significantly rise.

Making a relaxation for small businesses, rules allow those with an annual turnover between Rs. 20 lakh and Rs. 75 lakh (or up to Rs. 50 lakh for hilly States) to opt for the composition scheme and file returns every quarter, the bigger challenges seems to be automating their systems and installing at least one computer for making and uploading invoices.

“I run a small grocery store and though my turnover is over Rs. 20 lakh, I don’t know whether to run my shop or work out the computer system,” said Mahender Nath, the owner of a mom-and pop store in New Delhi.

Analysts say that the problem is bigger in tier 2 and 3 towns where connectivity and the use of computers is considered a big challenge.

“I recently met a client from Siwan (Bihar) who has a cement business and makes over Rs. 2 crore a year. He has registered for GST, but for him to get a computer and come on board for GST seemed bewildering,” said a GST Suvidha Provider (GSP) who did not wish to be named.

According to the Confederation of All India Traders (CAIT), of the estimated six crore small firms in the country, about 2.5 crore traders will not be included under GST as they will be out of the threshold.

“But at least 60 per cent of the remaining nearly four crore businesses don’t have a computer. Most are not very clear about the rules of the new tax either,” Praveen Khandelwal, National Secretary General of CAIT, had said at an event last week, adding that it is working on campaigns and awareness programmes for them.

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The Hindu Business Line, 26 June, 2017, http://www.thehindubusinessline.com/economy/small-businesses-grapple-with-gst-compliance/article9737658.ece?homepage=true


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