With the "turf issue" over tax payer jurisdiction continuing to clog the Goods and Service Tax (GST) Council deliberations, the rollout of the new tax could be delayed by a quarter, to July 1, as industry would require time to prepare itself, experts said.
The Council, chaired by Finance Minister Arun Jaitley, in its six meetings so far has taken unanimous decisions on 10 issues while three more - dual control, categorising items in tax brackets and the fineprint of the Model Central GST and Integrated GST laws - are still pending.
PwC India Executive Director Sumit Lunker said the April 1 rollout deadline seems challenging, as the CGST and IGST laws can now be passed only in the Budget Session in early February. Thereafter, states will have to pass the State GST law in their assemblies.
"After the laws are passed, industry would need at least 3-4 months time to be GST ready, especially on the information technology infrastructure front. Most information technology companies would come out with their patches and updates after the final law is crystallised. July 1 appears to be a more feasible date for implementation," he said.
Nangia & Co Director for Indirect Taxation, Rajat Mohan, said July 1 looks like the "best case scenario" for GST implementation as by then industry will also be able to migrate to the new taxation regime.
BMR & Associates LLP Partner Mahesh Jaising said a lot of hard work and time would have to be put in to meet the April 1 deadline. "The realistic timeline appears to be July 1. As of today, the services sector has some confusion over interpretation of the law and is awaiting clarity from government," he added.
Jaitley had last week said that certain "turf issues" still remain to be sorted out before rolling out GST. The new indirect tax regime can be implemented anytime between April 1 and September 16, 2017, according to the constitutional amendment.
"GST is a transactional tax and not an income tax. A transactional tax can start in any part of the financial year and therefore, the range of timing when it has to come into force because of constitutional necessity is April 1, 2017 to September 16, 2017. Hopefully, the earlier we do, the better it is for the new taxation system," Jaitley had said.
As far as the Model GST Law is concerned, Lunker said, there is no big challenge in passing it as the GST Council has already cleared discussion on 20 chapters and only 7 chapters remain.
"While the issue of dual control remains unresolved till date, state governments across the country are keen to implement GST at the earliest. I am hopeful that the GST Council in its December 22-23 meeting will arrive at a consensus on the pending issues," he said.
Deloitte Haskins & Sells LLP Partner Prashant Deshpande said that practically speaking an April 1 deadline "looks unachievable" because of the short window of time that will be available to the industry after the GST related legislations are passed.
"It will be a big tug of war to implement it from April and my advice to industry is that they should keep themselves prepared to ensure business continuity," he said.
Source : https://goo.gl/qonxJ8
Also Read : Expenses That Saves Your Tax Payments
The Council, chaired by Finance Minister Arun Jaitley, in its six meetings so far has taken unanimous decisions on 10 issues while three more - dual control, categorising items in tax brackets and the fineprint of the Model Central GST and Integrated GST laws - are still pending.
PwC India Executive Director Sumit Lunker said the April 1 rollout deadline seems challenging, as the CGST and IGST laws can now be passed only in the Budget Session in early February. Thereafter, states will have to pass the State GST law in their assemblies.
"After the laws are passed, industry would need at least 3-4 months time to be GST ready, especially on the information technology infrastructure front. Most information technology companies would come out with their patches and updates after the final law is crystallised. July 1 appears to be a more feasible date for implementation," he said.
Nangia & Co Director for Indirect Taxation, Rajat Mohan, said July 1 looks like the "best case scenario" for GST implementation as by then industry will also be able to migrate to the new taxation regime.
BMR & Associates LLP Partner Mahesh Jaising said a lot of hard work and time would have to be put in to meet the April 1 deadline. "The realistic timeline appears to be July 1. As of today, the services sector has some confusion over interpretation of the law and is awaiting clarity from government," he added.
Jaitley had last week said that certain "turf issues" still remain to be sorted out before rolling out GST. The new indirect tax regime can be implemented anytime between April 1 and September 16, 2017, according to the constitutional amendment.
"GST is a transactional tax and not an income tax. A transactional tax can start in any part of the financial year and therefore, the range of timing when it has to come into force because of constitutional necessity is April 1, 2017 to September 16, 2017. Hopefully, the earlier we do, the better it is for the new taxation system," Jaitley had said.
As far as the Model GST Law is concerned, Lunker said, there is no big challenge in passing it as the GST Council has already cleared discussion on 20 chapters and only 7 chapters remain.
"While the issue of dual control remains unresolved till date, state governments across the country are keen to implement GST at the earliest. I am hopeful that the GST Council in its December 22-23 meeting will arrive at a consensus on the pending issues," he said.
Deloitte Haskins & Sells LLP Partner Prashant Deshpande said that practically speaking an April 1 deadline "looks unachievable" because of the short window of time that will be available to the industry after the GST related legislations are passed.
"It will be a big tug of war to implement it from April and my advice to industry is that they should keep themselves prepared to ensure business continuity," he said.
Source : https://goo.gl/qonxJ8
Also Read : Expenses That Saves Your Tax Payments
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