Challenges of the GST are as follows :-
Reporting of HSN
Harmonised System of Nomenclature (HSN) is an internationally accepted writing . In filing monthly GSTR 3B, the detail w.r.t. to the HSN of the inward supplies wasn't required, however, the HSN wise detail is required within the annual Return GSTR 9. Reporting of HSN code increases the time and energy for monthly or quarterly compliance. Overall within the long run , not aligning the system of business with the GST regime could have very diversified impact on the business.
Numerous offences and penalties under GST
There are numerous penalties and offences under GST, principles of which also are mentioned by law. for instance , not registering under GST, albeit required by law is an offence. There are many other offences and penalties, which may hinder its popularity in India. the overall penalty under GST for any offence that it's not specifically mentioned are going to be susceptible to a penalty extending Rs 25,000. an individual are often arrested surely GST related offence by authorised CGST or SGST officer.
Reconciliation in GST
The Reconciliation process in GST isn't new any taxpayer as this was a standard practice in earlier VAT and excise regime. After reconciliation a taxpayer must match the info between the books of accounts to finish the method .
In the GST regime, the method of reconciliation may be a challenge. The invoice number that the purchaser has recorded doesn't match with seller’s invoice received in 2A. Both follow a special principle. one among the main challenges in following a reconciliation process is that both parties involved may have different nomenclature of storing the invoice numbers. On the opposite hand, the implementation features a hard match around invoice number.
Refunds are time taking in GST regime
It was said that the 90% of the refunds of GST would happen in 7 working days at the time of GST implementation. But after implementation , it didn't happen. The recent unearthing of faux invoices and fraudulent practices to corner input decrease may only cause more scrutiny and more delays. This leads to human interfaces, which can cause the involvement of corruption.
Items on which were brought under the perview of GST
There are certain items, which don't come under the ambit of GST. it's applicable on items like petroleum products and electricity should be brought under the GST to spice up the manufacturing sector. at the present , there's no official data available to point out this GST tax collections vis-a-vis the revenue being collected by 17 taxes like VAT, Octroi, service tax and luxury tax, which got subsumed once the GST was unrolled .
Lack of an efficient Helpline
Filling GST are often an excellent challenge as there's no helpline number, which may make this job hassle-free. Rules are complex and compliance is tedious. Even tax experts sometimes fail to know what must be wiped out a specific situation. during this situation, a typical tax payer cannot understand the nuances of GST. there's no efficient government helpline where a taxpayer can call and discuss his queries.
Several market players are offering solutions to affect the challenges associated with GST in several ways. they're as follows;
Accounting Software
There is a good range of accounting softwares available within the market to assist the taxpayers while filing GST returns. It makes the work easier and simpler. Such software are exclusively designed with algorithms that identify errors on each step of the GST filing process to form it hassle-free.
Government Role
The Indian Government is taking certain initiatives to seek out solutions to the challenges. The NDA Led government is trying its best to simplify and rationalise the GST regime.
In future, the council may consider merging the 12 and 18 per cent slabs into one one among possibly 15 or 16 per cent, which can also simplify the speed structure.
Revisit the GST law
Revisiting the law, can make the required changes and can further ease the method of tax filing by removing the unnecessary flaws. this may further improve the collection rates. within the long run , the country’s economy will grow.
With hindsight, it are often said that overcoming the challenges concerning GST implementation, the tax reform will have a long-term impact on the country’s GDP growth, simple doing business, expansion of trade and industry within the country making it a big economic power. (Source)
