‘GST registration issues mar TN’s biz-friendly image’

CHENNAI: The Federation of Indian Small and Medium Enterprises (FISME), in collaboration with the Tamil Nadu Chamber of Commerce, hosted a virtual media briefing to discuss the significant challenges faced by online MSMEs and potential sellers in Tamil Nadu in obtaining GST licenses.

TN houses the country’s third-largest number of MSMEs, with an 8 per cent share, totalling five million enterprises. Even so, many MSMEs in the state are encountering significant hurdles in obtaining GST registration. Bureaucratic inefficiencies and stringent, often misinterpreted, requirements from state authorities pose challenges for sellers.

These include excessive scrutiny regarding shared business spaces, the necessity of constant workstation presence and the obligation to justify TN as their primary state of registration.

Moreover, the requirements for physical offices mandated by Principal Place of Business registration and the complex process for updating GST certificates for Additional Place of Business registration only compound operational complexities and inefficiencies.

Manish Singla, CEO-founder, Healthy18, said, “Despite our earnest efforts to obtain GST registration in TN, we’ve faced repeated rejections, hindering our ability to serve the region. The short notice and inexplicable reasons further exacerbated the challenge. It’s disheartening as India strives to promote MSMEs, yet barriers persist.”

Sangita Prakash, director, Deloitte, emphasised, “As the GST law matures, the government must address the evolving needs of businesses. Simplifying registration processes, understanding and adapting to new business models, like shared spaces, and providing clear guidelines on procedural aspects are essential steps to enhance the ease of doing business. Training for both taxpayers and officials can also improve compliance and understanding of GST regulations.”

Chozha Naachiar Rajasekar, president of the Tamil Chamber of Commerce, highlighted, “We’ve carefully noted all the concerns raised by experts and sellers during the session. We are committed to collectively addressing these issues through official channels with the state government and the GST officials.”