Govt under pressure to push GST rollout to September 1

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Faced with multiple implementation challenges as they race to roll out the Goods and Services tax (GST) from July 1, a number of States as well as businesses want the new levy to be introduced from September 1.

Migration of assessees is behind schedule. Also, the IT infrastructure for GST by the GST Network is still being tested. It is very likely that States will seek more time for the introduction of GST, said two sources close to the development.

According to official data, barring the southern States, enrolment of businesses under GST continues to lag, with only about 70 per cent of them migrating as of the April 30 deadline.

Migration of service tax and Central excise assessees to GST was also low at 43.73 per cent and 24 per cent, respectively.

The issue is likely to be taken up at the GST Council meeting in Srinagar on May 18 and 19.

“Unless we have tested the GSTN how can we say we are ready? Then there are 14 draft GST rules in the public domain, which are yet to be finalised. We also have no clarity on whether new rules will come in or only 14 will be there. July 1 seems to be a very aggressive date for rollout,” Bimal Jain, Chairman, Indirect Taxes Committee, PHDCCI, said.

Finance Minister Arun Jaitley is keen on launching GST from July 1 and the Finance Ministry is making every effort to ensure this. The Ministry argues that a July 1 rollout of GST, which has been delayed by seven years, would mean it starts from the beginning of a new quarter.

“It could be an accounting headache for firms if GST started from September 1,” pointed out an official.

However, businesses, too, are getting anxious about the final rules and fitment of commodities. “Talks have only been taking place about goods; what about services? Here again there is no clarity,” Jain added.

“It will be a race to the finish. If the GST Council finalises the rates and rules in the May meeting, companies will still need some time to tune their systems. With the planned anti-profiteering authority, everyone wants to be very careful,” noted an industry representative, who did not wish to be named.

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