A year on, small traders say still reeling under GST
power-loom owner Bhavesh Patel and Kanpur’s tarpaulin maker Rohit Maheshwari have one thing in common: both nurse a grouse against the Goods and Services Tax (GST) that was billed as the biggest tax reform in India since independence, when it was introduced a year ago.
Patel closed his 17-year-old factory in January because the absence of input tax credit (ITC) for the textile industry led to an increase in manufacturing costs amid rising competition from China. “I was incurring losses to the tune of ₹50 per metre,” Patel said.
Maheshwari finds the filing of monthly returns cumbersome. He said many of his ITC claims have been pending with the government for the past year.
“Even a spelling or numerical mistake will leave me with a sore head,” he said, lamenting the poor technical infrastructure, recalling how server crashes had brought penalties.
The one year since the introduction of GST has been torrid for small businesses even though the Central government has tried to address some problems and reduced tax rates for several sectors like real estate.
“The number of powerlooms has slipped to 5.5 lakh from 7.5 lakh in Surat since implementation of GST. Around two lakh workers have lost jobs,” said Ashok Jirawala, president of the Federation of Surat Weavers Association.
According to Sachin Gala, a textile trader in Central Mumbai,“The submission of accounts three times a month only increases the cost for the traders” and he is forced to pass it on to the consumers.
“With this lack of transparency on ITC, homebuyers are understandably upset because their overall payment has increased,” said Anuj Puri, chairman of ANAROCK Property Consultants, Mumbai.
“The GST was said to be a dream taxation system but because of poor implementation it has become a major hassle for traders,” said Badish Jindal, president of the Federation of Punjab Small Industries Association.
Mahesh Kumar Singhania, chairman, Federation Of West Bengal Trade Associations said, “GST is definitely the best indirect tax that replaced about 50 types of state and central taxes and the Centre must be thanked for implementing it. However, we expected it to be well structured and properly implemented.”
MUMBAI/KANPUR/SURAT/CHANDIGARH/KOLKATA:Surat-based