With all Central legislation in place and only State level ratification pending, the stage is set for GST implementation. The 1 July 2017 target also seems realistic given that the major hurdles have been crossed.
GST will throw up many opportunities and challenges, and SMEs will be impacted to a greater extent. Under current laws small manufacturers with turnover below Rs. 1.5 crores p.a. are exempt from duties under the SSI (Small Scale Industries) provision. The corresponding exemption threshold under GST is Rs 20 lacs. Moreover, certain categories of businesses will compulsorily have to register under GST irrespective of turnover levels. This means many businesses that hitherto did not have to worry about indirect tax compliance will have to rework their way of doing business. Since GST’s primary objective is to help consolidate and streamline the elaborate (and confusing) process of indirect taxation and make it easier to administer, it is only logical that a wider tax net will and should result.
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