punjab

Updated: Jun 30, 2017 23:04 IST

As the Goods and Services Tax (GST), touted as the most “historic” tax overhaul, becomes a reality, thousands of small businesses and traders in Punjab fear a bumpy ride.

The dealers and businessmen, who have been protesting against the new tax slabs for the past several days, are worried about the “cumbersome” procedures and processes, penalties and other similar issues under the new law.

The transition will hurt small and medium (SME) businesses and traders who lack the wherewithal to comply with the new norms. “There are serious complications. If I sold 20 items, the bill prepared manually just took three minutes but not under GST. There are varying tax slabs and product codes, detailed records have to be maintained and returns filed online. How do they expect a small trader, who is a packer, salesman, owner and accountant all rolled into one, to maintain such records?” said Ravinder Dhir, convener, Jalandhar Joint Traders Action Committee. He said the government needs to simplify procedures and not tinker too much with tax rates under the GST to check tax evasion and promote transparency.

Ludhiana Cloth Merchant Association president Sanjay Arora also said that small-time traders and shopkeepers do not have the infrastructure and are bound to have issues with GST compliance.

“They barely have space to stock goods and sit in their shops even though their turnovers are above threshold limits provided in the law. How will they keep computers and operate them? The SME sector cannot compete with large industry, but will have to bear the brunt of GST due to reduction in turnover limit,” he said.

Though 86% of the 235,000 registered businesses and dealers have migrated to GST in the state, there are numerous glitches such as non-issuance of registration numbers and mismatch in PAN and other data. Also, the online e-way system is still to be made fully operational. E-way bills are needed for movement of goods worth more than Rs 50,000.

However, deputy excise and taxation commissioner Pawan Garg said people can do business without any hitch, as adequate provisions have been made to ensure smooth transition. “The state is at number two or three position in GST migration. Those who are having problems in migrating to GST due to data mismatch or other issues have been given the option to opt for new registration. They will get deemed registration in three days,” he said.

Garg said the first return is to be filed on September 5. “People can do their business and can file revised return even if there is delay in migration to GST,” he said. As for lack of wherewithal to file online returns, another department official said the department has been taking online returns under the value added tax (VAT) from 2012-13. “The limit was Rs 5 lakh earlier, but has been raised. Bogus billing will end under the new tax regime. That’s one of the reasons why so much noise is being made,” he said.