GST effect on air cargo sector

At the recently-held Air Cargo Summit 2017, the industry and senior government official discuss the growth and opportunities of air cargo logistics in the current scenario of the ‘One Nation, One Tax’ regime.

There has been a series of changes, be it administrative, procedural, regulatory, structural, policy, digitisation or technological solutions. The government is already looking into various issues. First of all, the air cargo supply chain need to be strengthened. The second area, is the GST preparedness and implementation. With GST, the government wants to provide a seamless way of handling the air cargo supply chain which strengthens every segment of the link. Air Cargo Community System (ACCS) would provide a platform to players to exchange information in a timely manner so that many of the clinches can be addressed. Vandana Agarwal Economic Advisor, MoCA, Goverment of India

Over the last few years, the ease of doing business has become a big mantra. But the question remains, what exactly is ease of doing business; is it lesser regulations, lesser monitoring, more trust, or has it made the process simpler? The most regretful thing happening to India is the resistance to change from the private sector, and not from the bureaucracy. We are having the political will to bring the change but it is the private sector which is taking back the government with the issues. It is important to understand that ease of doing business has to be addressed with speed. It has to be addressed with a change in the basics; whatever is not necessary can be ignored. We have to look at it as an opportunity not as a deterrent. Samir J Shah Chairman, FFFAI

One of the several measures that has been taken by the government along with GST implementation is that we are planning to introduce electronic seals, to be put in containers, in a big way with respect to the shipping side. In the air cargo scenario also, there could be a similar situation, in respect to bonded trucking. The focus of the department is to align all our IT system, both in the government as well as the private sector to the new GST regime. SP Sahu Commissioner (Single Window), CBEC

The logistics sector in the country, especially air cargo sector, is evolving rapidly and it is the interplay of infrastructure, technology and changing government policies on taxation and regulation, etc. Logistics pace is getting increasingly competitive. Presently, the Indian logistics industry is erratic and fragmented with relatively high logistics cost due to poor physical and communication infrastructure, high dwell time, low levels of containerisation and custom changing policies. The industry is keenly watching the impact of implementation of GST from July 1, 2017. We are more than convinced that the new tax regime will speed up the nation’s economic growth and stability and take this opportunity to improve the scope with this tax regime. However, simplification in the regime is much required. Vipin Vohra Co-Chairman, Civil Aviation Committee, PHD Chambers

Under ease of doing business, we need to clearly understand; do we need to go into the depth of understanding about every product that we are exporting or do we generalise as we are doing. Also, the manufacturer is not directly connected to logistics until the point that manufacturer has cargo in his warehouse. Few changes that are required to take place as we move forward are; firstly, the change in the processes which can be the big enabler for us. Secondly, more tailor-made solutions coming up in the process of handling cargo, be it from the perspective of the airline, handler or forwarder. Further, we are going to see constant technological improvement and this will help us grow our business collectively. Most importantly we must be benchmarking ourselves to the best in the world. Keku Bomi Gazder CEO, AAICLAS

International freight has to be out of GST.; it is not ease of doing business but just procedural delays and more financial cost for everyone. This never has happened, when there was service tax. There should not be GST on international freight because no international freight is subject to taxes all over the world. Indian exporters lead in not to burden with roundly integrated GST tax on international freight. We should not hassle our buyers with GST implementation on freight. Cyrus Katgara Partner, Jeena & CO