The implementation of GST has introduced a lot of simplicity in the current taxation structure that comprises of various levies and is incredibly complex. We commenced our GST implementation journey from February 2017 and the entire transition was planned to the minutest detail. However, at the initial stage, we rolled out a backup IT plan for a few days as software vendors were not ready with their GST solutions on time. As is normally the case with every transition, there were initial teething problems as the GST functionality was totally new to the operations team as well. However, due to advance planning and meticulous implementation, the overall transition was smooth and saw no major disruptions in operations.
While GST’s implementation is still in its nascent stages, understanding its full impact maybe a little premature. We have found that in terms of short term gains, price for dining at restaurants and staying at budget or mid-scale hotels would be more affordable to customers. However, the luxury segment would be under the highest tax bracket. An augmented input tax credit pool will reduce tax cost of carrying operations.
Since GST will abolish several other taxes, it will lead to a reduction in procedural steps and will provide more chances to streamline the taxation process. Apart from this, the filing of tax will be very easy because everything will be now computerised. It will take out all the ambiguity of having to deal with different taxes with different states which will help conserve time, energy and resources. As for the long terms gains, integration of the national market and free flow of credits would encourage alternate procurement options.
