Micro, small and medium enterprises (MSMEs) sector is much awaited to welcome the all mighty goods and service tax and also being in dilemma after what will be consequences of the same. The issues regarding the INR 1.5 crore limit on the levy of duty on MSMEs. While the same has been challenged to bring at a neutral level that of service tax.
The president of All India Food Processors’ Association (AIFPA) S Jindal mentioned that “The value of the manufacturing economy carries the value of the materials used in a manufactured product, whereas no material is used in services. The variance in the material type would result in different kinds of products.”
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He also added that “And subsequently the end cost of the product varies, while the service or the method of producing that product remains the same. Therefore, it would not be wise to place the manufacturing and service sectors at par with each other.”
Multiplicity of taxation is always expected by the current condition, and was mentioned that, “Under the GST regime, there will be one Central GST (CST), 36 state/Union Territory GSTs (SGST) and one integrated GST (IGST), and companies have to register themselves for each of the systems depending upon their business.And it is likely that the rates will not remain the same.”
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