Govt Works Overtime to Ready GST by April 1, 2017

Govt Works Overtime to Ready GST by April 1

 - Deepshikha Sikarwar, New Delhi:



Officials burning the midnight oil and even foregoing weekends to get the rules ready for the tax reform.

Work has begun full throttle on readying the goods and services tax (GST) architecture with government officials burning the midnight oil and foregoing weekends to get the rules ready for the tax reform that's regarded as one of India's biggest reforms.

The rules that will form the backbone of the new tax are being given finishing touches as the government pushes to get things in place for an April 1, 2017, rollout. The government hopes to draft the rules in 45 days so that testing can start even before the JanuaryMarch window.

“We want to push through with key stuff so that software can be tested,“ said a government official involved in the process. State government officials are also involved in the drafting of rules that could be put up for stakeholder feedback quickly.

Rules are necessary for IT configurations to be worked out and mock testing of transactions to begin.

There has been some uncertainty about getting everything ready by April 1, but the finance ministry doesn't share those doubts.

A number of provisions such as those dealing with valuation, which are currently defined through rules, have been enshrined in the act to bring about more predictability. But the rules are imperative as these will define key processes.

The draft model GST law and four re ports on business processes including registration and filing of returns will be ready soon.

States have begun the ratification process for the constitution amend ment bill to enable GST, which will replace a plethora of state taxes such as value added tax and entry tax and central taxes including excise duty and service tax.

The GST Council that will approve the law and rules and also finalise the rates will be set up soon after the presidential assent for the constitutional amendment. “All the groundwork would be ready for the council to take it up qu ickly,“ said another official.

Officials have already begun work on the model GST law in line with stakeholder feedback.

Companies too are already working on enterprise resource planning (ERP) software and an early draft of rules will allow them to expeditiously carry out changes and be ready in time for the GST rollout.

“Industry would hope that final rules would be notified latest by December 31, which would at least give three months for preparation,“ said Pratik Jain, partner and leader, indirect tax, PwC India. “The IT configuration cannot take place till the time rules are known. However, it is important to note that certain key provisions such as input credit and valuation have been incorporated in the Model Act itself.“

Source : Aug 15 2016 : The Economic Times