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Are you GST ready
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Are You GST Ready
By
Zubin Poonawalla
“All things are ready, if our mind be so.” ? William Shakespeare
India demonstrated unity in diversity & created Historical moment when Rajya
Sabha passed the Constitutional amendment bill unanimously. Country now
expects similar unison when GST Council will decide big bets like
Classification, Rates, Point of Taxation, Valuation, Related Party transaction &
Dispute resolution between States over GST share. We will certainly be ready
then for one India one Tax even though fundamental Duality will remain as its
feature.
Every Professional handling Indirect Tax in the country is being bombarded
with lots of questions about the granular aspects of GST applicable on first 6.5
Million GST Dealers. When it will come & how it will come seems like trivial
questions surpassed by the notion that “It has come, what next?”
Surprisingly professional fraternity like Chartered Accountants & lawyers are
frolicking with questions like
1. Do I need to increase or decrease my Depot Operations?
2. Should I produce more before GST Transition?
3. How much IT Cost is involved in GST Implementation?
4. Is my ERP sufficient to handle GST Transition?
5. What should be the criteria of Vendor Selection Post GST?
6. How my Market Share will be impacted post GST?
7. What are those hidden Gains for me in GST?
8. Do I need to disclose or share my gains with Customers or Government?
9. Do I need to change my MRP or Pricing Strategy for GST?
10.How to protect my distributor & retailer eco-system in GST?
Probably there are thousands of such questions being faced by hardcore Tax
Professionals in Industry & Advisory, for which they have to take a deep dive
into the business. GST law will not answer all these strategic
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business.queries which every businessman would like to know upfront without
going through the pains of browsing tons of information floating around.
Tax professionals were handling fragmented Indirect tax law divided between
States; central and local are now finding it exciting to see the full picture of
Business Cycle wherein they can apply new set of tools under GST law to see
the impact of it. It will involve huge unlearning & relearning in the process for
every stakeholder including State Tax Authorities handling taxes of Services
with no touch & feel.
Question which we must have answer is that “Is it a Change in Tax law?”
Should we drive it like CENVAT and VAT?
Answer is probably NO, because GST will expect equal bandwidth of Non-Tax
& Non-Finance resources to grab this as an opportunity to optimize their
business gains through GST. This is last opportunity to set right their process
for those struggling with best practices of Tax Compliance.
CEO, Supply Chain Heads, COO, CIO will form cross functional task force to
drive “Project GST” for smooth landing & growing their business post GST. Of
Course work for CFO & Tax Heads will increase multifold to ensure that
“Project GST” remain on the forefront till the time their company is confident
that they have examined all fine contours of GST. Getting best professional
advisory might become difficult because we might see bandwidth issues with
Experts running against time. A Precaution to protect their health & peace of
mind is a must to do this challenging multi-tasking.
Investors might ask Boards to provide confirmation that they are GST ready
with all strategic plans in place & emergency levers working before the D-Day.
“A journey of a thousand miles begins with a single step.” – Lao Tzu