President’s Desk – GCCI Bulletin July 2017

President’s Desk – GCCI Bulletin July 2017


Dear Members,
I feel extremely privileged to take over as the 38* President of the Goa Chamber of Commerce & Industry, in its 109* year of glorious existence and recognition. I also extend my sincere thanks, through this Page, being my first communique, to all my members for having elected me as the President of this illustrious association. I will continue to seek support and cooperation for the growth and development of the business ecosystem. Before I proceed further, I would like to thank our Immediate Past President Mr. Nana Bandekar with a promise that we will work around the vision with which he had flagged the Chamber’s journey during his term.

I was introduced to the Chamber by two past presidents Mr. Nitin Kunkolienker and Mr. Manguirish Pai Raiker in 2002. From then on, my journey began as a member of the taxation committee of the Chamber to eventually heading the same up to June 2017. I have been a part of the Managing Committee for the last fifteen years and have been the Vice President for six years. As the newly elected President, my scope of contribution will now go beyond individual committees and extend to the entire industry and the economy of Goa. I am sure that along with my dynamic Managing Committee and the support of the Secretariat, we will strive to achieve all our objectives.

As a Chartered Accountant, our profession requires us to be have an eye for detail as well as a true and fair assessment. I hope that this micro and macro approach to situations will guide me in my affairs at the Chamber as well.
As the President, my immediate objective is of course, one of the biggest game changing tax reforms introduced in the country, the GST the Goods & Services Tax, or as the government calls it, the Good & Simple Tax. Only time will tell us how simple the tax will turn out to be.
As the head of the taxation committee, we have been continuously holding seminars on GST since 2016 to help the business community in effective transition and compliance. Soon after taking over the Presidentship in July 2017, we held a two-day seminar dealing with the nuances and practical issues on GST, presented by nine expert faculties from Chennai, Delhi and Bangalore. The seminar was attended by more than three hundred participants. Many more such seminars covering practical issues of registration, return filing etc. to be held at various places are already in the pipeline.

While implementing this “one nation one tax” concept, the Government has time and again expressed its intent to safeguard small and marginal traders and service providers. Mr. Manish Gupta, IAS, ft. Secretary, Ministry of Labour & Employment had been deputed by the Centre to meet the industry and take their feedback on various aspects of GST implementation in the State. This proactive initiative was indeed welcome. We have made several submissions to Mr. Gupta and hope that he would take it forward with the appropriate authorities. Some of the issues highlighted include the hardship faced by small enterprises, where although their aggregate turnover is less than twenty lakhs and are thus, exempted from registering under GST, the bigger units buying from them are forcing them to register instead of availing the reverse charge mechanism. Another issue relates to the multiple filing of returns. Government should consider allowing the option of filing all three returns at one time. The problem for small service providers is even more acute and especially those who have no staff would find it very difficult to file so many returns.

The hotel and restaurant industry also has several issues. Tourism is a highly price sensitive sector and charging 28% GST on hotel rooms priced upwards of Rs 7500/ per night, a sharp rise of 7% (add to this, the system of dynamic pricing- a norm prevalent in the tourism industry) will make Goa globally un-competitive especially when most of the foreign tourist destinations charge a flat rate which generally ranges between 4% to 7%. Hence, a maximum rate for hotels pegged at 18% would be ideal.

In the case of construction projects, the turnaround time for completion of most projects varies between 2-3 years. Since under the present law, the transitional credit is allowed only for one year, the builders will not be able to take transitional credit in respect of most of their raw materials purchases.
The Government of India has been promoting use of IT Hardware under the Digital India campaign. The proliferation of this campaign could get impacted unless the issues of the IT industry are effectively addressed. Insulated cables which are an integral part of the IT hardware and are used extensively for Internet / Broadband connectivity attract 28% GST. This we feel, needs a review. Goa is major hub for data cable manufacturers like Birla Furukawa, Finolex, HFCL, Rosenberger, Smartlink, Universal Cables.

All these manufacturing companies will be hugely impacted by the inflation in rates.
A key issue the Chamber would like to highlight is that there are too many returns to be filed in the months of August and September. September is also the month of filing IT returns and company related returns. Besides, the robustness of the GSTNis yet to be tested. So a major part during this period will have to be devoted only towards returns filing. A small trader or enterprise does not have at its disposal the required manpower to exclusively handle this at the cost of business. So we would like to petition the government to defer the filing period for some returns.

It is indeed a strange coincidence that as the President, an issue closest to my profession is the most significant tax reform ever in the history of our country. Although there is no doubt that ushering in a common tax code was long overdue, the present law still poses uncertainties, differences of opinion and innumerable queries. As GCCI President, I would like to assure the industry that we will try our best to facilitate the smooth implementation of GST in the State. In the times of change, it is the learners who inherit the future.

Let me take this opportunity to extend my warm wishes to all members on the Independence Day in advance. Let us come forward and make a promise to take our nation to the path of prosperity.

 

Download GCCI Bulletin July 2017