After GST implementation, it may be on air that small businesses burdened with the tax but the initial report is not favouring the same. The data shows that 40 percent of businesses who filed GST return in July month has paid ‘nil or zero’ GST that means 22 lakh from 50 lakh of the taxpayers didn’t liable to pay any tax.
The remaining 60% of the taxpayers (around 32 lakh) have filed the return and tax in the Goods And Services Tax Network (GSTN). Many of them from the 32 lakh didn’t have any cash liability to pay a tax because they selected the available credits from services tax or excise duty they paid before GST implementation.
The collected data shows that around 70% of the businesses from 32 lakh have filed the GST ranging from Rs. 1 to 30,000. Contrary to the same, around 0.3% of the companies (around 10,000) have filed the taxes which accounted for 2/3rd of the total accumulated balance with GSTN. The government has shown the data that the tax collected from 52 lakh businesses had accounted around Rs. 94,000 Crore for July month.
Finance minister Arun Jaitley has said in a meeting of GST council that around 72 lakh taxpayers had migrated from the earlier tax system to GST and around 25-26 lakh taxpayers had registered newly under the GSTN and currently the total number of taxpayers registered under GSTN is 72 lakh. From the 72 lakh, approximately 10% businesses have a turnover of over 1.5 crores and they are covering the 94-95% of the total tax base.
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The government’s initiative to come under the ambit of GST has been criticised a lot by the political parties saying poor implementation of GST is the reason why businesses are facing problems. The government has replied to the threat and said that the reason behind the criticism is that the businesses which were previously out of the tax net or escaping away from the tax system are now propelled to pay the taxes.
Albeit the collection of tax is lower under GST, the government is expecting that GST will wide the tax base and create a space in reducing tax rates in near future. The FM Arun Jaitley also explained about future adjustments in tax rates for better applicability of GST and said, “As revenue increases, and depending on the revenue neutrality situation in the future, rates will be tailored according to the concept paper (that was cleared).”
