GST will mitigate the cascading effect of taxation : CII

The roll out of the Goods and Services Tax (GST) will be a revolutionary step in the field of indirect taxation reform in India, said Mr Sanjay Khurana, Chairman, CII Himachal Pradesh State Council at the Preparatory Workshop organised by Confederation of Indian Industry (CII). By amalgamating a large number of Central and State taxes into a single entity, it will mitigate the cascading or double taxation effect in a major way and pave the way for a common unified national market, he added.

Talking about the objective of having this Workshop, Mr Khurana said that it is important for industry to understand the impact and opportunities offered by this particular piece of legislation. GST will affect all industries, irrespective of the sector. It will impact the entire value chain of operations, namely procurement, manufacturing, distribution, warehousing, sales, and pricing. It will also trigger the need to relook at internal organization IT systems, he added.

Expressing his views on GST, Mr Amit Sarkar, Partner & National Head, Indirect tax, Grant Thornton India LLP said that GST is not just a game changer for the taxation structure of the country, but will also be an opportunity for India to upgrade its regulatory environment to the global best practices. He was of the opinion that if handled and implemented well, GST has the potential to unlock country's growth prospects.

It is encouraging to see the efforts that the Government is making to bring GST to the best interest of the country said Mr Krishan Arora, Director, Indirect tax, Grant Thornton India LLP. He was hopeful that the monsoon session would witness consensus reached amongst all the political parties facilitating in this landmark reform progressing towards reality.

Sharing his perspective on GST and its economic benefits to industry, Mr Babu Khan, Regional Director, CII Northern Region said that GST, when implemented, is expected to usher in a harmonised national market of goods and services and shall lead to a simplified, assessee-friendly tax administration system. It will subsume most of the country's central and state level duties and taxes, thus making the country one national market and contribute significantly to the growth of the economy'

Along with this, an Workshop for industry on recent changes related to Direct Taxes such as Income Computation and Disclosure Standards (ICDS), Income Declaration Scheme etc was also organised by CII

Addressing the issues on Domestic Transfer pricing, Mr Rajeev Jain, Director, Grant Thornton India LLP expressed that Domestic transfer pricing regulations were introduced in India by virtue of amendments brought out by Finance Act 2012. FY 2016-2017 will see the conclusion of first round of assessment proceedings for cases involving domestic transfer pricing disputes. There is a lot of speculation regarding the positions which would be taken by the Indian revenue authorities on various issues like coverage of transaction with indirectly held entities, applicability on capital expenditure transactions, benchmarking approach of director remuneration etc, he added.

Sharing the recent development Ms Priyanka Sahi, Direct Tax Specialist said that the notification of foreign credit rules and valuation rules for indirect transfer is a welcome move by the Government bringing about clarity and showcasing Government's keenness to lend an ear to the stakeholders involved. However, what also needs immediate attention is the roll out of final ICDS guidelines in tandem with adressing MAT implications as the industry moves towards adoption of Ind AS, she added.

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