GOODS AND SERVICE TAX

Taxes which are ultimately bourn by final consumers are called Indirect Taxes. Generally any transaction, whether in goods or services, attracts various indirect taxes. Indirect taxes are usually borne by the final consumer. Therefore, if a business entity fails to anticipate the applicability of an indirect tax and does not recover the same from the consumer it becomes a cost to the entity and is a direct hit to the bottom line. Consequently indirect taxes have a direct bearing on the costs, pricing policy, cash flow and profitability and ultimately the competitiveness of an organisation. Hence it becomes critical to evaluate the impact of various indirect taxes on any given transaction.
Historically, India divided the power to tax various transactions between the Union and the States. This was especially true about indirect taxes such as excise, services tax, sales tax and value added tax. This resulted in different taxes being applied by the Central and State tax departments on sales and services transactions. The taxes were not deductible against each other and varied in rates of tax, compliance requirements and assessment procedures. Apart from cascading taxation, the system created several artificialities within business to ensure tax efficiencies. These taxes were replaced by a uniform Goods and Services Tax (GST) regime in July, 2017. The new regime aims at greater transparency and fairness but involves a robust compliance system. Though a rather complex and convoluted regime is implemented in India, it has ensured most transactions are tax neutral and allowed companies to focus on their business rather than tax efficiency models.
However, being a new regime, it bring new challenged and needs redressals such as transition procedures, intangibles, anti-profiteering, classification, refunds, input credits, transaction in securities, trade promotion schemes, subvention income, securitization, and other issues.
At M. S. Chhajed & Co. we provide comprehensive advice and assistance on indirect taxes. Our services broadly cover the following:
  • GST Advisory
  • GST Implementation
  • GST Compliance
  • GST Trainings
  • Compliance Review and Exposure Assessment
  • Representation and Litigation