LD GST 2 LAST

Assocham sought relaxations from penal and prosecution Assocham sought relaxations from penal and prosecutionprovisions during the first two years of GST launch except inthe case of tax fraud or non-deposit of collected taxes. It wanted that the Centre and states should set up amechanism to advise traders on legal provisions arising out ofthe implementation. Mitra called upon the industry to give suggestions on thequantum of penalty, saying the empowered committee and theGST Council will look at the provision of arrest andprosecutions. The industry chambers also demanded single centralisedregistration of suppliers of services that operate indifferent states in place of multiple state-wise registrationsfor specific service sectors. "The states recognised very much that certain serviceslike telecom come under the central scheme. Under the currentdraft, you would need to register in each state which wouldmake it very very cumbersome," Forbes said. "And states were very receptive to the idea that one needsa simple, single registration. Because that won’t affectrevenue, it will only make a simpler and more transparentregime." The rapidly expanding e-commerce companies made a strongpitch for keeping them out of the proposed GST ambit, but thestate finance ministers appeared in no mood to oblige. When Mitra questioned the billion dollar valuations someof the so-called online platforms command, the e-retailerssaid their source of revenue is advertisement on which theypay service tax. Vendors selling goods through their portals should beliable to pay GST, they argued. Nasscom in its representation said the sector is creatinghuge job opportunities and allowing small industries to selltheir products. Stating that e-commerce facilitates competition, it saidone cannot avoid being in the tax bracket. Mitra, however, said the discussions so far have concludedthat the e-commerce sector is generating millions of dollar,but pay practically no taxes. According to Mitra, consumers buying products online payVAT, producer pays excise duty but these companies go untaxedon the pretext that the transaction is just a pass-through. "E-commerce brings in competition, but you are also addingsome value. Else how are your companies generating so muchvaluation?" Mitra wondered. He felt that the issue may become a political hot potatoas the end product will come under GST but the intermediarywill not pay tax. The model draft GST law has brought e-commerce under itspurview. Under it, all online purchases will be taxed at thefirst point of transaction. Putting e-commerce under GST is expected to solve someof the tax woes of such companies. States like Uttarakhand,Assam and Bihar recently imposed a 10 per cent entry tax onthe goods sold online and there were fears that more statesmay follow suit. The GST regime is seen as ending such arbitrary moves bystate governments. PTI JDARD