GST Still Needs a Lot of Improvement

GST has undoubtedly helped in unifying the Indian market and bringing transparency in the tax system. However, there are still a lot of issues that need to be addressed to make GST a more effective tax regime. In this article, we will discuss some of the major issues with GST and suggest possible solutions.

Complexity

One of the major issues with GST is its complexity. GST is a multi-stage tax regime that involves tax collection at every stage of the supply chain. This makes compliance a challenging task for small and medium-sized businesses. The GST law and rules are often too technical for small businesses to understand, and they end up making mistakes while filing returns.

Solution: To address this issue, the government should simplify the GST law and rules. The government should also introduce a simplified GST return filing system for small businesses.

High Tax Rates

Another major issue with GST is the high tax rates. The government has placed GST rates on almost every product and service, ranging from 5% to 28%. The high tax rates have led to an increase in prices, which has affected the purchasing power of consumers.

Solution: The government should consider revising the GST rates and bringing them down to a reasonable level. This will not only reduce the burden on consumers but also help small businesses to thrive.

Technical Glitches

Technical glitches have been a constant issue with the GSTN portal, which is used for GST registration, return filing, and payment. The portal has faced several issues like downtime, slow processing, and data corruption, which have caused inconvenience to taxpayers.

Solution: The government should take strict action to improve the GSTN portal's technical infrastructure. Regular maintenance and updates should be done to ensure that the portal functions smoothly.

Compliance Burden

The compliance burden of GST is another significant issue. Small businesses are required to file multiple returns every month, which is a tedious and time-consuming task. This has led to an increase in compliance costs for small businesses.

Solution: The government should introduce a simplified return filing system for small businesses. The GSTN portal should be made more user-friendly and should provide easy access to compliance-related information.

Conclusion

In conclusion, GST has undoubtedly helped in unifying the Indian market and bringing transparency in the tax system. However, there are still a lot of issues that need to be addressed to make GST a more effective tax regime. The government should take concrete steps to simplify the GST law and rules, reduce the tax rates, improve the technical infrastructure, and reduce the compliance burden. This will not only benefit small businesses but also help in boosting the Indian economy.