The Goods and Services Tax (GST), which is the country’s biggest tax reform since independence, came into force on July 1 and promises a stronger economy and less corruption. Under the GST regime, a four slab tax rate structure of 5 per cent, 12 per cent, 18 per cent and 28 per cent has been adopted. While this landmark tax paves the way for the vision of ‘One Nation, One Tax’, it has also generated apprehension among the populace on how it will affect their finances, businesses and day-to-day life.
On Sunday, revenue secretary Hasmukh Adhia, the driving force behind the framing of GST, took to Twitter to shoot down some common misconceptions about the landmark tax.
Higher tax rate
Myth: The new GST rate is higher compared to earlier VAT.
Reality: It appears higher because excise duty and other taxes which were invisible earlier are now subsumed in GST and so visible now.
Myth: All invoices must be generated on computer/internet only.
Reality: Invoices can be generated manually also
Myth: A retailer needs internet all the time to do business under GST
Reality: Internet would be needed only while filing monthly return of GST.
Myth: A retail business I have provisional ID but waiting for final ID to do business
Reality: Provisional ID will be your final GSTIN number.
Ease of doing business
Myth: An item of trade was earlier exempt, so the retailer will need new registration before starting business now.
Reality: You can continue doing business and get registered within 30 days.
Myth: There are three return per month to be filed
Reality: There is only one return with three parts, out of which first part filed by dealer and two other parts auto populated by computer.
Myth: Even small dealers will have to file invoice wise details in the return.
Reality: Those in retail business (B2C) need to file only summary of total sales.