Skip to main content

With GST, in place , there would be uniformity in imposed taxes

By

With the central and state governments laying down the groundwork for the roll-out of the goods and services tax (GST), Karan Choudhury spoke to Krishan Arora,  partner, Grant Thornton India LLP, on how the new indirect tax regime would impact the e-commerce sector.
How is the e-commerce industry preparing for the GST roll-out?
E-commerce players are getting detailed GST analysis undertaken to assess impacts and changes on various facets including financials, cash flows, working capital, IT  changes, and compliances.
Do you think the industry would be looking at restructuring warehouse as there would be no area- specific advantage left ?
Currently, warehousing strategies are tax- oriented, which restricts effective utilization of available resources and leads to logistics effeciency. With the GST in  place, there wouldbe uniformity in imposed taxes.
Companies may consider restructuring warehouse strategy , keeping in mind business imperatives and not tax. For Example, a company might have one big warehouse at a  central location, which might serve multiple states, leading to a decrease in the number of warehouses. Alternatively, companies might opt for warehouses at specific  locations on the basic of a hub and spoke model.
Are companies aligning its systems with input tax credit? How are they re-structuring your IT preparedness?
There are various changes an e-commerce player would be required to make in its enterprise resource-planning platform.To illustrate, a few key changes made in IT systems/formats are the following: Each invoice will need to include a Harmonised System of Nomenclature (HSN) or service Accounting Code(SAC) code,  the Place of Supply should be determined based on GSTIN for B2B transactions and delivery address for B2C sales, tweaking to be done to deduct and account for TCS,tracking mismatches for input credit, return filing etc.
Will they need to hire more people to handle the paperwork,which might increase due to GST implementation? By how much would the overall costst increase?
While compliances may slightly increase, the same would be simplified since evry state would have similar compliance requirements/formats, which can be done online, sitting at one place. Therefore, depending upon the volume of business transactions, the companies would need to assess their additional manpower requirements and corresponding costs. 
The Business Standard New Delhi, 26th April 2017

Comments

Post a Comment

Popular posts from this blog

New income tax slab and rates for new tax regime FY 2023-24 (AY 2024-25) announced in Budget 2023

By
  Basic exemption limit has been hiked to Rs.3 lakh from Rs 2.5 currently under the new income tax regime in Budget 2023. Further, the income tax slabs in the new tax regime has been changed. According to the announcement, 5 income tax slabs will be there in FY 2023-24, from 6 income tax slabs currently. A rebate under Section 87A has been enhanced under the new tax regime; from the current income level of Rs.5 lakh to Rs.7 lakh. Thus, individuals opting for the new income tax regime and having an income up to Rs.7 lakh will not pay any taxes   The income tax slabs under the new income tax regime will now be as follows: Rs 0 to Rs 3 lakh - 0% tax rate Rs 3 lakh to 6 lakh - 5% Rs 6 lakh to 9 lakh - 10% Rs 9 lakh to Rs 12 lakh - 15% Rs 12 lakh to Rs 15 lakh - 20% Above Rs 15 lakh - 30%   The revised Income tax slabs under new tax regime for FY 2023-24 (AY 2024-25)   Income tax slabs under new tax regime Income tax rates under new tax regime O to Rs 3 lakh 0 Rs 3 lakh to Rs 6 lakh 5% Rs 6
Post a Comment
Read more

Jaitley plans to cut MSME tax rate to 25%

By
Income tax for companies with annual turnover up to ?50 crore has been reduced to 25% from 30% in order to make Micro, Small and Medium Enterprises (MSME) companies more viable and also to encourage firms to migrate to a company format. This move will benefit 96% or 6.67 lakh of the 6.94 lakh companies filing returns of lower taxation and make MSME sector more competitive as compared with large companies. However, bigger firms have shown their disappointment since the proposal for reducing tax rates was to make Indian firms competitive globally and it is the large firms that are competing globally. The Finance Minister foregone revenue estimate of Rs 7,200 crore per annum for this for this measure. Besides, the Finance Minister refrained from removing or reducing Minimum Alternate Tax (MAT), a popular demand from India Inc., but provided a higher period of 15 years for carry forward of future credit claims, instead of the existing 10-year period. “It is not practical to rem
1 comment
Read more

Don't forget to verify your income tax return in August: Here's the process

By
  An ITR return needs to be verified within 120 days of filing of tax return. Now that you have filed your income tax return, remember to verify it because your return filing process is not complete unless you do so. The CBDT has reduced the time limit of ITR verification to 30 days (from 120 days) from the date of return submission. The new rule is applicable for the returns filed online on or after 1st August 2022. E-verification is the most convenient and instant method for verifying your ITR. However, if you prefer not to e-verify, you have the option to verify it by sending a physical copy of the ITR-V. Taxpayers who filed returns by July 31, 2023 but forget to verify their tax returns, will get the following email from the tax department, as per ClearTax. If your ITR is not verified within 30 days of e-filing, it will be considered invalid, and may be liable to pay a Late Fee. Aadhaar OTP | EVC through bank account | EVC through Demat account | Sending duly signed ITR-V through s
Post a Comment
Read more