Reactions to GST

“The Goods & Services Tax is a transformational structural reform which will have multiple benefits – the creation of a national market; enhanced ease of doing business; greater productivity & efficiency; and improved tax compliance. All stakeholders are working together for a seamless transition to this new paradigm. This reform will result in benefits for all participants in the Indian economy, including both businesses & consumers”, said Ms.Chanda Kochhar, MD & CEO, ICICI Bank.

"GST regime is set to bring the big transformation in the industry. Fintech player like us have witnessed a big boon n this initiative as many financial institutions have been moving towards the digitization of their payment process. This has resulted in faster realization of the returns as at Rubique, we work on success based commission with financial institutions. Some of the FIs have also started revising the commission rates to accommodate these taxes," said Mr. Manavjeet Singh- Founder and CEO, Rubique

"GST will be a game changer whereby it will push businesses into the formal sector. In the current scenario, businesses operating in the informal sector thrive on information disparity and cash for tax avoidance. With GSTIN, the information disparity will be greatly reduced thereby improving and increasing the tax network. The government steps of curbs on cash with limits of 2 Lakhs and above requiring reporting will also assist in pushing businesses towards digital payments. With ease in compliance, set off available for credits entrepreneurs will be driven to adopt digital payments from their end customers," said Mr. Deepak Kothari- CO-Founder, ftcash

Beyond the impending apocalypse that is being foretold, the digitization of transactions for the massive $600 bn retail industry will give unprecedented access to high quality data that could be used by manufacturers and traders to serve the end consumer better. And regardless of its shape and form today, GST will be a key enabler in accelerating retail growth over the next 5 years. We hope that both GST and the Industry are able to evolve rapidly, said Mr. Mayank Premi- CO-Founder and Director , Beacon.

"“GST is a significant milestone in our journey towards a digitally networked One India- One tax Vision. From a macro-economic impact, GST should have a transformational impact on GDP-tax ratio and enable efficient businesses to transcend state boundaries and also compete in states which till now had high indirect taxes. This will lead to emergence of bigger and more efficient businesses improving the overall health of industries. In the context of Online lending, industry will benefit from the online availability of GST data to assess business health and associated risks, enabling Online lenders to make better and faster lending decisions and driving flow of efficient capital to deserving businesses and heathy growth of Online lenders as well in the long run.” said Mr. Amit Sachdev- CEO & CO-Founder, CoinTribe Technologies Pvt. Ltd.

"One of the biggest tax reforms post-independence, the Goods and Services Tax (GST) is set to bring forth unprecedented transformation of the Indian economy. There is a lot of conjecture around the preparedness for GST across industries, especially the MSME sector. But I strongly feel that GST will prove to be a strong enabler for systematic growth of the MSME sector as it will provide an impetus for Digitization of the sector and promote their Financial Inclusion. With the micro and small businesses migrating towards digital book-keeping, they would be better predisposed towards fulfilling the eligibility criteria for credit facilities. This will allow NBFCs like ours, which currently have to rely on data analytics and alternate intelligence tools, to make a better assessment of their credit worthiness and offer a line of credit at economical terms, " said Mr. Ashish Sharma- Head of Finance, Aye Finance.

"As far as trading and investments in the capital market is concerned, I do not think GST will have a great impact. The service tax charged on 'brokerage and transaction charges' will increase from current 15% to 18%. However, brokerage charges on equity delivery are zero with Zerodha, hence the impact of 18% increase will not really burden our customers. At a broader level, GST roll out is a huge positive for the country. Agreed, the initial few months can be chaotic with the clarity needed on many fronts. However, in the long run, GST is the way forward," said Nithin Kamath, Founder & CEO, Zerodha.

“With Goods and Service Tax (GST) being implemented from 1st July and Real Estate Development and Regulation Act (RERA) already being in force, the Real Estate sector is experiencing enormous change. On projects that have not received completion certificate from competent authorities, the tax rate for real estate sector under GST is now being raised from 12% to 18%. The increase in rate will increase the cost to end user by 5% to 6%. Apart from GST, the addition of Stamp Duty will increase the overall cost in many states. But GST would definitely help in bringing down the construction costs due to lower tax on input items like cement and steel coupled with tax credits at various stages of construction will ultimately benefit both the developers and the buyers. Additionally the evolving market dynamics have compelled the developers to change their approach focusing on customer and delivery. GST will help in venturing India’s goal by empowering more transparency and simplicity of operation in all property deals,” said Mr. Shaliesh Puranik, MD, Puranik Builders.

"The implementation of GST from 1st July, heralding a new era in tax reforms, would impart much needed competitiveness to Indian exports with initial hiccups. The spin off effect on economy particularly on the logistics sector would also help both manufacturing & exports. The refund mechanism through an electronic platform will reduce transaction cost. In initial stages, exporters will have to bear the blockage of their working capital and therefore the refund mechanism should be efficient in line with the spirit of the Act. Looking at the pragmatic approach of the Government in facilitating Exim trade, Mr Gupta expressed optimism that Government will soon consider to give IGST exemption to various duty neutralization instruments under Foreign Trade Policy besides exemption on procurement of goods for exports by merchant exporters", says Shri Ganesh Kumar Gupta, President, Federation of Indian Export Organisations (FIEO).

“Retailers Association of India (RAI) acknowledges the Goods & Services Tax (GST) as a game changer for the retail industry. It is a giant step forward for India to create uniformity of taxes across the country. We believe, GST is more about change management than taxation—it is undoubtedly one of the biggest exercises in change management till date for team India. Almost everything we have learnt as citizens of this country with respect to indirect taxes will have to be quickly un-learned to welcome an era of one country one tax. Like with all change management, reactions to GST has three phases: Uninformed optimism, informed pessimism and finally informed optimism. The first phase existed till the mid-May 2017; and we are now in the second phase of informed pessimism that may peak by end August 2017. Informed optimism is a long way off and we hope will come soon”, says Kumar Rajagopalan, CEO, Retailers Association of India.