Dr. Somnath, International Journal of Research In

Dr. Somnath, International Journal of Research in Management, Economics and Commerce, ISSN 2250-057X, Impact Factor: 6.384, Volume 07 Issue 10, October 2017, Page 85-94 Developments in Indirect Taxation in India: Road Ahead

Dr. Somnath (Assistant Professor of Economics, Mukand Lal National College, Yamunanagar, Haryana, India) Abstract: India is the largest Federal democracy in the world. The Constitution of India provides that no tax shall be levied or collected by anyone except by the authority of law. Under the constitution, only the Parliament and State legislative assemblies have exclusive powers to make laws for levy of taxes. Prior to July,2017 multiple indirect taxes were levied by centre as well as states, by multiple agencies, due to which, not only avoidable leakages in tax collection taken place but also free flow of goods and services was affected. Doing business in such an environment became difficult and cumbersome affecting the national growth of the country negatively. In such a scenario Indian parliament has shown extraordinary foresight in conceiving a single indirect tax applicable throughout the country, which will make doing business easy, will help in increase business volumes leading to increased national growth, and will also help the government increase its welfare budget with higher collection of taxes ultimately resulting in overall prosperity of its citizens. With this aforementioned importance, On July 1, 2017, India unleashed its most revolutionary taxation reform in form of goods and services tax (GST) that promise to infuse a fresh energy into the economy by unifying the entire country into one Single Market. More than, twenty six years after liberalizing its economy to the outside world, India has now rolled out another significant financial reform that aims to carry forward and cement on the growth benefits of liberalization. The new goods and services tax (GST) subsumes 17 central and state taxes and 22 types of cess into single tax, thereby eliminating the complexity of multiple taxes, cascading of taxes and thus achieving significant simplification in indirect taxation. This paper is an attempt to review developments in Indirect Taxation system with the special focus on GST in India and effects of these developments on Indian Economy. Keywords: Taxation, Tax Policy, Fiscal Policy, Tax Reforms, Tax Evasion and Avoidance, Tax Law. JEL Classification: H2, H20, H21, H26, K34

I. INTRODUCTION The word ‘tax’ first appeared in the English language only in the 14th century. It derives from the Latin ‘taxare’ which means ‘to asses’. A tax is not a voluntary payment or donation, but an enforced contribution, exacted pursuant to legislative authority and is any contribution imposed by government whether under the name of toll, tribute, import duty, custom, excise, subsidy, by any another name. The basic principles of taxation are nearly as old as human society itself-the history of taxes stretches thousands of years into the past. Several ancient civilizations, including the Greeks and Romans, levied taxes on their citizens in order to pay for military expenses and other public services. Taxation evolved significantly as empires expanded and civilizations become structured. In India, the tradition of taxation has been in force from ancient times. It finds its reference in many ancient books like ‘Manu Smriti’ and ‘Arthasastra’. The Islamic rulers in the Mugal period imposed the Jizya tax. It was later on abolished by Emperor Akbar. However, Aurangzeb, the last prominent Mugal Emperor, levied Jizya on his mostly Hindu subjects in 1679. Reasons for this are cited to be financial stringency and personal inclination on the part of emperor. The period of the British Rule in India witnessed some remarkable change in whole taxation system of India. Although, it was highly in favour of British government and its exchequer but it incorporated modern and scientific method of taxation tools and systems. In 1922, the country witnessed a paradigm shift in the overall Indian taxation system. Setting up of the administrative system and taxation system was first done by the British. Taxes in India today are decided on by the governments: Central, State and local bodies. The authority to levy tax is derived from the constitution of India which allocates the power to levy various taxes between Centre and State. This review paper is based on secondary data of articles, journals, newspapers and magazines. Considering the objective of paper (Review of developments in Indirect Taxation system) descriptive type research design is adopted to have more accuracy and rigorous analysis. Purpose of Taxation Taxes are mainly used to finance expenses incurred by the government to mana ge an economy. These expenses include: health care, education, garbage collection and operating government business entities. Taxation is also used by government for several other purposes such as:  Financing Government spending  Reducing gap between rich and poor (Robin Hood Effect) http://indusedu.org Page 85

 Reducing consumption of demerit Goods  Controlling Inflation  Equilibrium in Balance of Payments  Protecting local industries Principles of Taxation In a context where many governments have to cope with less revenue, increasing expenditures and resulting fiscal constraints, raising revenue remains the most important function of taxes, which serve as the primary means for financing public goods such as maintenance of law and order and public infrastructure. Assuming a certain level o f revenue that needs to be raised, which depends on the broader economic and fiscal policies of the country concerned, there are a number of broad tax policy considerations that have traditionally guided the development of taxation systems.  The Benefit Principle: This principle holds that the taxes levied on individuals should be in proportion to the benefits that they receive from the governments and that taxes should be paid by those people who receive the direct benefit of the government programs and projects out of the taxes paid.  The Ability-to-Pay Principle: This principle holds that taxes should relate with the individual's income or the ability to pay i.e., people with greater income or wealth that can afford to pay more taxes should be taxed at a hi gher rate than people with less wealth. E.g. Individual income tax.  The Equal-Distribution Principle: This principle holds that income, wealth, and transaction should be taxed at a fixed percentage; that is, people who earn more and buy more should pay mor e taxes, but will not pay a higher rate of taxes. Developments in Indian Indirect taxation System Any tax levied by the government which is not backed by law or is beyond the powers of the legislating authority may be struck down as unconstitutional. Taxe s in India are levied by the Central Government and the State Governments. Some minor taxes are also levied by local authorities such as Municipality. Central Government State Government Local Bodies  Income Tax  Sales Tax  Properties  Service Tax  Stamp duty  Octroi  Customs duties  State excise  Tax on Markets  Central excise  Land revenue  Charges on utilities  Sales Tax  Duty on entertainment and services like  Tax on professions water supply, sewage and callings disposal. The Central Board of Revenue or Departm ent of Revenue is the apex body charged with the administration of taxes. It is a part of The Ministry of Finance which came into existence as a result of the Central board of Revenue Act, 1924. Initially the Board was in charge of both direct and indirect taxes. However, when the administration of taxes became too unwieldy for one Board to handle, the Board was split into two, namely the Central Board of Direct Taxes (CBDT) and Central board of Excise and Customs (CBEC) with effect from January 1, 1964. Taxes are basically of two distinct types: Direct and Indirect taxes. Direct Taxes, as the name suggests, are taxes that are directly paid to the government by the taxpayer. It is a tax applied to individuals and organizations directly by the government e.g. income tax, corporation tax, wealth tax etc. Indirect Taxes are applied on the manufacture or sale of goods and services. These are initially paid to the government by an intermediary, who then adds the amount of the tax paid to the value of the goods / s ervices and passes on the total amount to the end user e.g. sales tax, service tax, excise duty etc. DIRECT Taxes Income Tax Tax levied directly on an individual's income Corporate Tax Annual taxes payable on the income of a corporate (company) operating in India Securities Transaction Tax Tax applicable on every transaction done at the stock exchange Wealth Tax (abolished by Charge on the net wealth of the Assessee http://indusedu.org Page 86

INDIRECT Taxes Excise Duty Tax charged on goods produced within the country Custom duty & Octroi (On Custom duty - Tax charged on goods imported into Goods) India Octroi - Tax applicable on goods entering in to municipality or any other jurisdiction for use, consumption or sale Service Tax Tax on service providers on certain service transactions, but borne by the customers Sales Tax Tax on the sale of goods and services. Sales can be broadly classified into three categories, (a) Inter -State Sales (b) Sales that come under import/ export (c) Intra - State (i.e. within the State) sales Value Added Tax Tax on the amount by which the value of an article has been increased at each stage of its production or distribution Anti-Dumping Duty ... Tariff that government imposes on foreign imports that it believes are priced below fair market value OTHER Taxes Professional Tax Tax imposed by respective Municipal Corporations on employees of Private Organisations Dividend distribution Tax Tax imposed on companies according to the dividend paid to a company's investors Municipal Tax Property tax levied by Municipal Corporations Entertainment Tax Tax on every financial transaction that is related to entertainment such as movie tickets, major commer cial shows, exhibition, broadcasting services, DTH services and cable services Stamp Duty, Registration Fees, Taxes on the handing over of the tide of property Transfer Tax ownership by one person to another Education Cess Education cess is deducted and used for Education of poor people. Surcharge Surcharge is extra tax or a fee which is added to your existing tax calculation. Gift Tax Tax on a gift received from someone Toll Tax Tax to use infrastructure like roads, bridges etc Swachh Bharat Cess Cess to create a Clean India Krishi Kalyan Cess Cess to extend welfare to farmers Dividend Tax 10% additional tax on dividend income above 10 Lakh Infrastructure Cess Infrastructure cess on car and utility vehicles Entry Tax Tax imposed by some State Governments for items entering in the state boundaries ordered via E -commerce Throughout history, people have debated the amount and kinds of taxes that a government should impose, as well as how it should distribute the burden of those taxes across society. Unpopular taxes have caused public protests, riots, and even revolutions. In political campaigns, candidates' views on taxation may partly determine their popularity with voters. In addition to using taxation to raise money, governments may raise or low er taxes to achieve social and economic objectives, or to achieve political popularity with certain groups. Taxation can redistribute a society's wealth by imposing a heavier tax burden on one group in order to fund services for another. Also, some economi sts consider taxation an important tool for maintaining the stability of a country's economy. Road Ahead with GST The Goods and Services Tax (GST), the biggest reform in India's indirect tax structure since the economy began to be opened up 25 years ago, h as become reality. The http://indusedu.org Page 87

This work is licensed under a Creative Commons Attribution 4.0 International License Dr. Somnath, International Journal of Research in Management, Economics and Commerce, ISSN 2250-057X, Impact Factor: 6.384, Volume 07 Issue 10, October 2017, Page 85-94 reform process in indirect lax regime of India was started in 1986 by VP Singh by introduction of Modified Value Added Tax (MODVAT). However, the tax policies stayed behind and could not keep pace with the growing economy as well as changing reality of doing business. The need to reform the existing indirect tax system in India was felt a couple of decades ago. GST is expected to have a far reaching impact, much beyond taxes on economy and the society. Globally, GST is acknowledged as a progressive tax regime, with inbuilt efficiencies to broaden the tax base, decrease cascading effect and reduce revenue leakages. The recently implemented GST in India is expected to bring in uniform tax rates and provisions to simplify the compliance r equirements across the country, supported by automated systems and processes. A well designed GST structure can foster common market and economic growth. India has adopted a dual GST model where the central and state governments will levy GST simultaneously, on a common taxable value, on the supply of goods and services. However, in the case of imports and interstate supplies, an IGST (Integrated GST) is levied by central government. The implemented GST subsumes most of the existing central and state taxes on the supply of goods and services including central excise, service tax, state level Value Added Tax (VAT) and other local levies on goods. With GST, there will be a significant shift from origin -basic taxation to a destination - based tax structure impacting not only the operating business models but also the revenues of the centre/states. GST has the potential to impact cash flow, pricing, working capital, supply chain and IT systems and hence provides an opportunity to transform your business. GST - Goods and Services Tax, one of the widely accepted indirect taxation systems prevalent in more than 160 countries, is a single tax rate levied on the manufacture, sale and consumption of goods & services at a national level. GST is also referred to as VAT in some countries. Definition: Goods & Services As per GST Act 2016 Goods means every kind of movable property includes: actionable claim, growing crops, grass and things attached to or forming part of land excludes: money, securities Services means anything other than goods includes: activity related to the use of money or its conversion by cash or by any other mode, for which a separate conversion is charged excludes: goods, money, securities GST is levied on the supply of goods and services at each stages of the supply chain from the supplier up to the retail stage of the distribution. Even though GST is imposed at each level of the supply chain, the tax element does not become part of the cost of the product because GST paid on the business inputs is claimable. Hence, it does not matter how many stages, where a particular goods and service goes through the supply chain because the input tax incurred at the previous stage is always deducted by the business at the next stage of the supply chain. Input Tax, Output Tax, Input Tax Credit  Input tax is the GST charged on the purchase of goods and services used in the business activity. It is REFUNDED from the Government.  Output tax on the other hand, is GST charged and collected on sales/supplies of goods and services. It is PAID to Government.  Input tax credit means tax input claimable by businesses registered under GST. GST is a broad based consumption tax covering all sectors of the economy i.e. all goods and services made in India including imports except specific goods and services which are categorized under zero rated supply and exempt supply orders as determined by the Finance Ministry. The basic fundamental of GST is its self-policing feature, which allows the businesses to claim their input tax credit by way of automotive deduction in their accounting system. This eases the administrative procedures on the part of businesses and the Government. Thus, the Government's delivery system will be further enhanced. In most countries, a single VAT exists which covers both goods and services. Typically it is a single rate VAT but two or three rate VAT systems are also prevalent.

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II. NEED FOR GST The Implementation of GST would not only lead to the simplification of the tax regime, but would help remove its inherent defects. Some of the critical flaws such as the multiplicity of laws and taxes, the cascading effect of taxes, the non -fungibility of credits between goods and services, the possibility for taxpayers to shift their base only to take advantage of a low tax regime, among other factors, would be addressed in due course by this new system. Also, there would be a paradigm shift from origin based taxation to destination based taxation, as is prevalent elsewhere. Prior to GST, the tax structure of India was very complex. Looking to the global developments and tax structure of developed countries, GST is the need of the hour in India. The need of GST can further be explained in the following points:  There are various definitional issues related to manufacturing, sales, service, valuation etc. that arises. These need to be rationalized.  Several transactions take the character of sales as well as services, thus there is complexity in determining the nature of transaction.  The mechanism of imposing taxes, exemptions, abatements and other benefits are different in state and centre  Existing law has resulted in significant number of issues related to interpretation or various provisions and the category of the products and the nature of services.  Administration mechanics of the centre and state and even in different states is different.  India needs comprehensive levy and collection on both goods and services at the same rate with the benefit of input credit  A simple tax structure can bring greater compliance, thus increasing number of tax payers and in turn tax revenues of Government.  GST will ensure competitive pricing. Tax paid by final consumer will come down in most cases. Lower prices will help in boosting consumption which is beneficial to Companies.  GST will ensure boost to exports. When the cost of Production falls in the domestic market, Indian Goods and services will be more prices competitive in foreign markets. Issues in Previous system  Confusion and Mistrust  Complex and lacking in stability  High transaction costs  High compliance cost  Lack of harmony and interstate practices  Narrow base  Too much litigations  Hidden tax on exports, no state tax on imports  Highly corruption A Brief Introduction to GST Particulars Previous Taxation Model GST Model 1 Structural a) Central Taxes:- A dual layered tax Difference Central Excise/ system with both Custom Duty, Central and State Central Sales Tax GST levied on same on Goods and base on all the goods Service Tax and services except charged on Petroleum, High Services, Surcharge Speed Diesel, Motor & Cess spirit and Natural Gas to be brought at b) State Taxes-State a later date, subject Vat, Sales Tax to recommendation Deducted at of GST Council Source, WCT, Luxury Tax, Entertainment Tax, Tax on Lottery, Surcharge & Cess http://indusedu.org Page 89

2 Place of Taxable at the place At the place Taxation of sale of goods or consumption i.e. rendering of service destination based tax 3 Registration Decentralized registration under Uniform e-Registration process Central and State Authorities based on PAN 4 Payments and Refunds Central Excise and Service Tax- Uniform process and common Uniform, VAT-Varies from State dates for collection/deposit of tax to State and filing of returns 5 Excise Duty Excise Duty charged up to the To be subsumed in CGST point of Manufacturing 6 Countervailing Duty/Special Imposed by Centre under separate To be subsumed in CGST Additional Duty - Act CVD/SAD 7 Service Tax Charged by Centre on list of To be subsumed in CGST & Services under Finance Act on SGST Payment/ Provision Basis 8 Central Sales Tax Charged by Centre on list of To be subsumed in IGST Services under Finance Act on Payment/ Provision Basis 9 State VAT Imposed by States on all goods To be subsumed in SGST except exempted items 10. Entry Tax Currently being charged by No entry tax, Additional 1% of selected states for interstate Tax to be levied on inter-state transfers, held as import in local supply of selected goods, list yet area to be finalized 11. Tax on Import in India Goods : Under Customs Duty Basic Custom Duty on goods : No (comprises Basic Customs Duty, Change; CVD & SAD on import CVD & SAD) Services : Under of goods and import of services : Service Tax To be subsumed in GST 12 Inter-State Transactions Goods & Services : Imposed by To be subsumed in GST & subject the Centre to SGST & CGST 13 Powers to levy Tax on As Excise Duty (CENVAT) No such powers in GST Manufacture :Centre 14 Powers to levy Tax on Sale Inter-State: Centre Local: State Concurrent powers to Centre & of Goods State 15 Powers to levy Tax on Centre Concurrent powers to Centre & Provision of Services State 16. Tax on inter-State Transfer Exempt against Form F To be taxable but full credit of Goods to Branch or available to dealers Agent 17 Tax on Transfer of Goods to Generally exempt; Depends upon Might be taxable, unless TIN of Branch or Agent within State procedures transferor and transferee is same States 18 Cross-Levy set-off Set-off of Excise duty and Service No cross set-off between CGST tax is allowed and SGST 19 Cascading Effect Credit between Excise Duty & Credit available on the full Service Tax available, but no set- amount of taxes up to retailer off against VAT on Excise Duty 20 Non-Creditable Goods There are certain non-creditable No such goods and services under both disallowance, unless specified by VAT & CENVAT Rules GST Council 21 Credit on Inputs used for Not allowed No such disallowance, unless Exempted Activities falling under the Negative List 22 Exemptions -Excise Free Some areas enjoy status of No such Exemptions, Investment Zone, VAT Remissions Excise/Vat Exemptions i.e. North Refund Scheme (IRS) may be East, Himachal introduced for existing zones based upon recommendations of GST Council 23 Exemption for transit Inter- Exists Might be taxable http://indusedu.org Page 90

State Sale and High Seas Sale 24 Stamp Duty Presently taxed concurrently by Out of purview of GST the Centre and State 25 Threshold Limits a) Central Excise-1.5 a) Exemption limit Crores for NE States - Rs b) VAT-Varies from 10 Lakhs Rs. 5 to 20 Lakhs b) Exemption limit from state to state for Rest of India c) Service Tax- Rs.10 -Rs 20Lakh Lakhs

III. MECHANISM OF GST Under the GST tax credit mechanism, the vendor can "set off" it s output tax liability against its input tax credit to arrive at the "net GST payable" (if the amount is positive) or "net GST refundable" (if the amount is negative). The vendor is required to remit the "net GST payable" amount to the tax authority in acc ordance with prescribed procedures, and the vendor is entitled to a refund of the "net GST refundable" amount from the tax authority in accordance with prescribed refund rules. We can use the below illustration to explain how GST works for Standard -rated supplies:  Stage 1: The Manufacturer who is in the first stage of the supply chain sells the product for a price of INR 100 to the Wholesaler. Assuming 18% GST, it will be INR 18 and he will pay GST of INR 18 to the government after collecting it from the Wholesaler.  Stage 2: The wholesaler sells the goods to the retailer for a price of INR 200. 18% GST will be INR 36. The wholesaler will collect INR 36 from n taller and pay it to the Government. As he has already paid INR 18 in Stage 1, he will get a refund of INR 18 from the Government.  Stage 3: The retailer sells the goods to the consumer for a price of INR 250. 18% GST will amount to INR 45. The retailer collects INR 45 from the consumer and pays it to the Government. As he has already paid INR 36 in Stage 2, he will get a refund of INR 36 from the Government. Thus, we see that end consumer is the actual payer of GST who has paid INR 45 to the Government. But in reality there may be many more Mages until the product reaches the consumer. For Zero-rated supplies, the value of goods increases at various stages but GST is Zero at every stage. If any GST is paid, it will be claimable. Features of Ideal GST GST is based on the principle of value added tax and either "input tax method" or "subtraction" method, with emphasis on voluntary compliance and accounts based system.  It is a comprehensive levy and collection on both goods and services at the same rate with benefit of input tax credit or subtraction of value of penultimate transaction value.  Minimum number of floor rates of tax, generally, not exceeding two rates.  No scope for levy of cess, re-sale tax, additional tax, special tax, turnover tax etc. No scope for multiple levy of tax on goods and services, such as, sales tax, entry tax, octroi, entertainment tax, luxury tax, etc.  Zero rating of exports and inter State sales of goods and supply of services. Taxing of capital goods and inputs whether goods or services relatable to manufacture at lower rate, so as to reduce inventory carrying cost and cost of production.  A common law and procedures throughout the country under a single administration.

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Comprehensive levy No scope for levy of and collection on cess, re-sale tax, both goods and additional tax, special services at the same tax, turnover tax etc rate No scope for multiple levy of Destination tax on goods and based tax services

Based on the A common law

principle of Value and procedures Added Tax throughout the country

Benefits of GST GST is considered a better and fairer tax system compared to several Indirect taxes including Service Tax as GST will: Eliminating hidden activity  Under declaring of Imported goods  Transfer pricing of Manufacturing goods Greater Transparency  GST will be shown on the invoice  Consumers will know exactly whether the goods they consume are subject to tax and the amount they pay for. Less Bureaucracy  GST registered company will manage their own accounting for tax.  Business can claim any input tax paid without undergoing any bureaucracy process.  Electronic / Online Registration, GST Statement Submission, Claiming input tax Fair Tax System and Business Friendly  Fair Tax System — GST will be charged at every stage of supply chain, (manufacturer, wholesale, retailer) on value added activity.  Business friendly Overcome weaknesses of sales and service T ax in terms of  Fair Tax System - GST will be charged at every stage of supply chain, (manufacturer, wholesale, retailer) on value added activity  Business friendly The below stage in a supply chain illustrates how GST is beneficial to traders: Existing System - Existing System GST with invoice - without invoice Manufacturer to Wholesaler Sale price 100,000 110,000 100,000 Add: Excise Duty 12% 12,000 Add: VAT 4% 4,000 Add: GST 18% 18,000 Final Payment 116,000 110,000 118,000 Wholesaler to Retailer Sale price 150,000 150,000 150,000 Add: VAT 4% 6,000 Add: GST 18% 27,000 Final Receipt 156,000 150,000 177,000 Tax payment by Wholesaler 2,000 9,000 Net profit to Wholesaler Sale price of goods 156,000 150,000 177,000 Minus - Purchase Cost 116,000 110,000 118,000 Minus - Net tax paid 2,000 9,000 Net profit 38,000 40,000 50,000 From the above, it is evident that GST is beneficial to the Wholesaler http://indusedu.org Page 92

IV. GST MODELS There are three prime models of GST: Central GST > GST to be levied by Centre State GST > GST to be levied by State Dual GST > GST levied by Centre and States simultaneously A. Central GST (CGST) The two levels of government would combine their levies in the form of a single National GST, with appropriate revenue sharing arrangements among them. The tax could be controlled and administered by the Central Government. B. State GST (SGST) The States alone levy GST and the Centre withdraws from the field of GST or VAT completely. The State GST will work as the redistributing mechanism. C. Dual GST a) Non-Concurrent Dual GST: GST on goods can be levied by the States only and on services by the Centre only. The States already have the power to levy the tax on the sale and purchase of goods (and also on immovable property), and the Centre for taxation of services. b) Concurrent Dual GST Indian Model: GST will be levied by both tiers of Governments concurrently. There will be Central GST to be administered by the Central Government and there will be State GST to be administered by State Governments. In this model, both goods and services would be subject to concurrent taxation by the Centre and the States. GST in Other Nations Many countries have adopted GST/VAT because they are dissatisfied with their consumption tax structure. This dissatisfaction falls broadly into at least on e and possibly all of the following categories:  The existing consumption sales tax is unsatisfactory  A reduction in the rate of taxes is sought  The existing tax system has not kept pace with the developm ent of the economy Currently, there are 160 countries in the world that have implement VAT/GST. Number of countries based on region is as follows: No. Region Countries 1 ASEAN 7 2 Asia 19 3 Europe 53 4 Oceania 7 5 Africa 44 6 South America 11 7 Caribbean, Central & North America 19 Countries that have implemented VAT/GST recently (in the last 5 years): Malaysia-2015 Grenada-2010 Gambia – 2013 Saint Kitts and Nevis - 2010 Congo – 2012 Laos, Niue - 2009 Seychelles – 201 Sierra Leone - 2009 Comparison of tax rates around the world is difficult and somewhat objective. Tax laws in most countries are extremely complex, and tax burden falls differently on different groups in each country and sub -national unit.

V. CHALLENGES UNDER GST IT Preparedness and Infrastructure It cannot be assured whether all the States and Union Territories in India are currently equipped with infrastructure and requisite manpower. Except few states like Karnataka, Maharashtra and Gujarat, who have pioneered the E-Governance model, we have not heard about this trend in other States and Union Territories. Officers Training The unlearning of the old law and learning GST provisions is imperative. GST law heavily banks on Information Technology and hence proper training has to be given to the departmental officers for effective usage and implementation. http://indusedu.org Page 93

New Registrants Transition of existing registered assessees and registration of new assessees and resolving of migration issues is a big challenge. Pending Cases/ Past Disputes There are many disputes pending in the context of present indirect tax laws (both Centre and State), which are at various stages, viz, adjudication or appellate level. Government should find ways and means to resolve these disputes. A possibility of introducing a dispute settlement scheme on the lines of Kar Vivad Samadhan Scheme needs to be explored which would enable the litigants to resolve pending matters. Tax Administration With GST, both the centre and state level officers are expected to work under one roof and in tandem by giving up their differences. Cadre differences may arise, as presently in Central Excise and Service Tax, the departments are headed by officers of IRS, whereas in the state commercial departments, the commissioner is from IAS and his subordinates would be from State Administration Service.

VI. CONCLUSION With the GST, India has joined select League of Nations. The implementation of GST would result in abolition of multiple taxes and would bring the much needed uniformity and certainty in taxes rates. GST would also ensure that tax at each stage is creditable thereby avoiding double taxation. It will also boost the government initiative of MAKE IN INDIA as companies would be able to create manufacturing and industrial hubs across the country as GST breaks the barriers of State regulations.

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