The main expectation from this system was to abolish all indirect taxes and to ensure the prevalence of only one indirect tax structure to prevail in India. The multi-layer taxation norms, which have been prevalent in India since independence was a system where tax was paid upon tax, which lead to not only rise in inflation in the country but also lead our domestic consumer market to be less competitive.
GST, a taxation system which would be levied both on goods and services was supposedly aimed to build a uniform tax base for both goods and services on an equal footing and create a common platform to charge tax on both goods and services, thereby creating a single indirect tax structure across the nation. This philosophy had led to the much coined slogan, “one nation, one tax”. Nevertheless, as a tax professional in India can we actually meaningfully term this tax reform as a one nation, one tax regime?
The GST structuring has been designed in such a manner that it rates a common man contemplate whether the new tax regime is the same law printed in a new book thus considering India to be comprised of 29 small states each having independent sovereignty. The indirect tax structure, which prevailed earlier in India had depicted a similar philosophy and in the current GST regime, we are in all probability heading for the same fate if a few major amendments are not brought in with immediate effect.
Some of the key issues, which needs to be realigned in order to edge closer to the concept of one nation, one tax is as follows.
l Simple and single monthly compliance return across all states which would capture the entire goods and services supply and procurement throughout the entire country.
l Complete abolition of Waybill and check post concept within the country.
l Complete uniformity in the rate of taxes for all goods and services across the country.
l Abolition of multiple registration of GST in different states leading to tedious compliances in each state. Assessee to be registered at a single place with numerous additional places of business across all the states.