An apex Indian industry body on Wednesday raised concerns regarding July 1 rollout of the Goods and Services Tax (GST), saying the government may have to defer the implementation of the new indirect tax regime by a couple of months.
The rates decided under various slabs for GST are likely to be made public only close to the date of implementation, said Harsh Mariwala, chairman, GST Task Force, FICCI, adding that participants may tamper with the supply chain if the announcement is made earlier.
It’s unlikely that government will be able to implement GST on July 1, he said. “They have an opportunity…they have an option of deferring it by one or two months, so I think they will take a call within this month,” said Mariwala, who is also the chairman of Marico Ltd.
Small and medium enterprises are still unprepared, added Mariwala, while larger industries have started getting ready to transition to the new indirect tax regime.
The industry body believes that there are bound to be some teething issues once GST is rolled out. “I think this will continue for some time and we will have to get used to some degree of lack of clarity for the next few months, post implementation of GST also,” Mariwala said.
Minister of state for finance Arjun Ram Meghwal struck a different note though, saying one of the salient features of the GST regime is to simplify the process, thereby aiding even the small and medium enterprises. Speaking on the eve of the two-day GST Council meet in Srinagar, Meghwal reiterated the government’s stated position that most goods and services will be taxed at a similar or lower rate than the current levels.