How GST Will Benefit Retailers
Good and Services Tax (GST) is a comprehensive tax which is to be levied on manufacturing, sale and consumption of goods and service at PAN India level. It’s an effort to do away with various indirect taxes or double taxation, thus opening up doors for a common market and removing state boundaries.
Introduction to GST emerges mainly because of extremely complex tax rules in India. It aims to completely eliminate double taxation.
It fully integrates taxation at national and state level and doesn’t discriminate between Goods and Services. Forming a part of the proposed tax reform, GST will ensure a practice of seamless and organised tax structure.
Taking into the considerations of the retail industry, GST will be a boon to the industry at different stages of business. For starters, it will make way for easier procurement and movement of raw materials. Suppliers and vendors will go hand in hand as often unnecessary and time-consuming paperwork at state boundaries will be avoided. Better margins could be had with the help of simple tax and input tax credits. GST also aims at eliminating red tape and lengthy documentation & submission of various forms. The advantages for retailers are the following:
Single Tax- With its implementation, the state and central government will come together for a single tax regime thereby avoiding multiple state and central taxes.
Unified Market- CST and entry tax will be abolished which paves the way for business growth along the length and width of the country.
The demarcation between Goods and Services- Under the new system, goods and services would be treated as one package. Until now these two were counted as a separate entity on some occasions.
Improvement in Supply Chain- Bottlenecks at state borders during transportation of goods is a major issue. Lots of inventory lies stuck in transit which hampers on time delivery. This will be eliminated once GST is implemented.
Ginesys is planning to implement GST as soon as the announcement is made and the necessary requirements would be adhered to.