Mumbai based Trade Association of Information Technology (TAIT) launched a workshop on 23rd August 2016 with an emphasis on ‘GST Model Law’. Since the law is expected to be implemented in India during April 2017. This is part of the TAIT knowledge series to increase awareness on various topics that were of relevance to the IT industry to its members. The workshop was conducted by Rajeev Varaiya, who is a partner of chartered accounting firm, Damania & Varaiya. Varaiya explained the implications of the present ‘GST Model Law’ on business across sectors while also providing insight on its finer nuances and how it would benefit the Information Technology sector.
He highlighted the rationale behind GST and the taxes that were proposed to be subsumed while providing insight on the various benefits that it would provide to manufacturers and distributors. Varaiya also emphasized that India is only the second country to adopt a dual GST system to ensure revenues. The dual GST system is where state governments would receive revenues irrespective of intra-country or international trade.
There was also emphasis placed upon certain exclusions from GST such as alcohol, petroleum products (which would be brought under GST purview at a later date), electricity duty, basic custom duty, stamp duty and property tax on immovable property as well as Motor Vehicle Tax.
It is expected that while GST shall require a certain adjustment period, in the long term, it would benefit manufacturing and the supply chain while enhancing transparency and efficiency.