AFCCI Madurai says GST rules getting harder, urges govt to simplify
The present GST is riddled with complexities, and difficult to understand even by tax experts, said the chamber. Several notifications, clarifications and amendments made over the past seven years have made it more complex, it said.
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MADURAI: The Agro Food Chamber of Commerce and Industry (AFCCI), Madurai has appealed to the Union Finance Minister Nirmala Sitharaman to simplify GST laws in the upcoming council meeting scheduled on September 9, to ensure entrepreneurs don’t suffer.
The present GST is riddled with complexities, and difficult to understand even by tax experts, said the chamber. Several notifications, clarifications and amendments made over the past seven years have made it more complex, it said.
“It is a welcome move that the Finance Minister has called for simplifying tax notices and is said to have advised the Income Tax department to work towards being fair and friendly with taxpayers”, the chamber said.
Simplification should ensure clarity in the rate of tax for different products, according to the stakeholders.
GST is levied based on the Harmonized System of Nomenclature (HSN code), an internationally standardized system of names and numbers used to classify traded products introduced by the World Customs Organization (WCO), S Rethinavelu, president, of AFCCI, Madurai said on Monday.
The HSN code has 21 Sections covering all products, under which there are 99 chapters with 1,244 headings and 5,224 subheadings, describing different products.
Things falling under the headings and sub-headings are subjected to different tax rates under GST and that confuses the rate of tax leading to litigations, Rethinavelu said.
Deciding different tax rates by different “Authority on Advance Ruling” (AAR) for the same commodity is crystal-clear proof of the conundrum prevailing in the present structure of tax rates, he said.
Therefore, the Chamber suggests that the only solution is levying tax based on Sections in the HSN Code for all products covered under the broad heading of one section.
Levying the same rate of tax for products other than products chosen for total exemption would go a long way in the process of simplification of GST, the chamber head said.
It’s pertinent to note that most global countries adopted a single rate of GST, Rethinavelu said.