gst-pedia for smbs

GST Shiksha Hub for MSMEs From iON

TCS iON has partnered with Laghu Udyog Bharati to help MSMEs be current in their understanding of GST. The GST Shiksha hub aims to provide relevant information on GST to all MSMEs on a real-time basis and helping MSMEs across India to be updated on any GST-linked development. The partnership will benefit MSMEs in facilitating self-learning, with anywhere anytime access to study material enabling them to create a technology supported collaborative work place.

TCS iON will also work to integrate Laghu Udyog Bharati’s existing GST learning content into a digital medium, providing MSMEs an online alternative to upgrade their GST knowledge. With the availability of digital learning content, Laghu Bharati Udyog will be able to reach MSMEs in remote areas, ensuring availability of the latest GST information.The GST Shiksha hub is being hosted on TCS iON Digital Learning HUB.

GST-enabled banking for SMEs from DBS and Tally

DBS Bank India and Tally Solutions have partnered to launch a connected banking platform to enable convenient GST payments and accounting processes for SMEs.The solution available to DBS Bank’s SME customers on the GST-ready version of Tally ERP 9, allows management of GST and supplier payments entirely within the ERP. With a single login, SMEs can make payments, track payment transaction status and automatically send payment receipts, along with suppliers’ invoice details.

Through this integration, its SME customers can enjoy a host of benefits, such as: • Connected Bank: e-Payments can be sent from the Tally platform to DBS Bank in a single click Easy Tracking: Payment status and transaction references can be tracked on a single dashboard in Tally Instant Approval: The DBS Bank IDEAL mobile app offers approval on-the-go Automated Advice: Vendors can be kept informed with automated transaction advising Security: The highest standards of encryption are assured while making and approving payments

GST ready Sellers Through Amazon ClearTax partnership

Amazon India has partnered ClearTax to help sellers on its marketplace file and reconcile their tax returns conveniently as per the upcoming GST rollout. ClearTax Biz and Cleartax Biz+, two softwares launched by ClearTax, will be available to the Amazon India sellers free of cost for the first two months after signup. Subsequently, the software will be provided at a 30% discount for sellers registered with Amazon India.

Businesses selling online have an increased burden with GST. They have to claim TCS, Tax Collected at Source and input tax credit properly on time. Delay in GST actions poses significant risk to working capital of these sellers. The ClearTax GST software for Amazon sellers solves these problems in a simple three step process unlocking working capital and reducing risk in their business.

Amazon India recently launched ‘A-Z GST Guide’ program that has trained and enabled thousands of sellers on the platform get ready for GST. The online portal provides resources in the form of tutorials, blogs and free online training sessions.

Doubts have been raised regarding the applicability of the Margin Scheme under GST for dealers in second hand goods in general and for dealers in old and used empty bottles in particular.

Dealer Margins Under GST in Ambiguity

Rule 32(5) of the Central Goods and Services Tax (CGST) Rules, 2017 provides that where a taxable supply is provided by a person dealing in buying and selling of second hand goods i.e., used goods as such or after such minor processing which does not change the nature of the goods and where no input tax credit has been availed on the purchase of such goods, the value of supply shall be the difference between the selling price and the purchase price and where the value of such supply is negative, it shall be ignored. This is known as the margin scheme.

Further, notification No.10/2017-Central Tax (Rate), dated 28.06.2017 exempts Central Tax leviable on intra-State supplies of second hand goods received by a registered person, dealing in buying and selling of second hand goods [who pays the central tax on the value of outward supply of such second hand goods as determined under sub-rule (5)] from any supplier, who is not registered. This has been done to avoid double taxation on the outward supplies made by such registered person, since such person operating under the Margin Scheme

cannot avail input tax credit on the purchase of second hand goods.

Thus, Margin Scheme can be availed of by any registered person dealing in buying and selling of second hand goods [including old and used empty bottles] and who satisfies the conditions as laid down in Rule 32(5) of the Central Goods and Services Tax Rules, 2017.

GST Impact on SMEs and credit growth

It is speculated that GST has made banking services more expensive. The most striking impact was on deployment of the ATM which has become more expensive now with a tax rate of 28% imposed on it. However, there is a bright side to the chapter of GST as well. With the digitalization initiative, now there will be transparency in business information and taxation details.

The moneylenders are hopeful with the single producer tax imposed which would definitely create a common market across India thus boosting credit growth. Earlier getting a loan for financing micro and small scale industries was a big nightmare. The accounted loan sanctioned in this section was just 0.1%.

In India, there are numerous SMEs, start-ups and growing businesses that need financial support the most, but the banks failed to play their role of lending money here. Here are some of the obstacles that kept the banks away from extending their helping hand to the needy businesses: • Lack of Financial Information: The financial informa- tion presented by the SMEs is not adequate, even their legitimacy is questionable at times. This is the biggest reason that makes the bank turn their back to the pleas of these business ventures.

• No Track Record: Young businesses fail to present a sustainable track record and banks rely on the history to process the loan

• Lack of Security: Banks need to scrutinize a lot of things before releasing the funds to make sure that the banks don’t incur loss. In case of SMEs the uncertainty is huge, so they need some kind of guarantee to ensure the payback.

With the implementation of GST, the detailed information of the businesses and taxes would be available in an electronic format and it would be much easier for the banks to process the loans for SMEs and self-employed portfolios. Once the full cycle of data is available and the bank could ascertain the legitimacy then there will definitely be acceleration in the credit growth of these segments.

GST opted for a unifying tax replacing the existing multitude of taxes. Earlier there were numerous taxes applied on a single item like service tax and excise duties for central and state taxes, such as octroi, entry tax and VAT. The picture of the banking industry was also somewhat similar. But now the service taxes that were applicable on almost all banking services, are going to be absorbed in the GST: Hence, the rate of the levy has gone up from 15% to 18%, but the impulse remains almost the same.