memorandum on proposed GSTbill by KHAGA

Hon. Shri Arun Jaitely Ji The Union Finance Minister Government of India Room No-134, North Block NEW DELHI - 110001 RESPECTED SIR, Date: MAY,9TH,2015 SUBJECT- Goods and Service Tax in India Respected Sir, We the members of “KARNATAKA HOSIERY AND GARMENT ASSOCIATION” representing traders and manufacturers hereby represent our point of view on the Proposed “Goods and Service Tax” :- WE FEEL THAT TO BE INSPIRED IS A GREAT BUT TO INSPIRE IS INCREDIBLE...GST MUST BE IN SUCH A FORMAT WHICH INSPIRES AND MOTIVATES THE WHOLE NATION TO CONTRIBUTE TOWARDS THE EXCHEQUER VIA GST...DISCUSS IN LENGTH WITH THE TRADE ASSOCIATIONS AND FINAL RESULT WILL BE EXTRA-ORDINARY...ALL THE BEST... 1. The Proposed Goods and Service Tax is being introduced in our country is not in the “Standard format” of the GST and it is a dual tax on which both state and Centre will collect tax on a single transaction of sale of supply of Goods and Services. The trade and Industry have been waiting for a Indirect tax in which only one tax would be there, but sir proposed GST is not as per the expectation of large number of trade and Industry. 2. Sir, at present the central excise is being charged on the value of more than 1.50 Crore but in the proposed system CGST replacing the Central excise will be imposed on Rs. 10.00 Lakhs, hence large number of dealers will have to pay CGST who at present are not covered the central excise. 3. The rate of Tax as proposed (Coming in the News) is 26% (CGST14% Plus SGST 12%) which is very high considering the fact most of non exciseable goods are charged at present 5% or at the most 14%. Sir, how the trade and industry will face this high rate of Tax and this on one side will certainly result in evasion of Tax and ultimately will hurt the Indian Trade and Industry and Economy and on the other side will be instrumental in high price rise adversely effecting the common consumer. 4. The whole system of GST will depend on Information technology and the speed and capacity of Internet in our country is not up to the mark. The dealers of VAT who are facing lot of problems with information technology system of the states and will face more problems when GST is introduced without substantial improvement of the Information system. 5. Sir, the Government itself is not clear about the RNR (Revenue neutral rate) hence there is lot of confusion about the success of the GST and there is still confusion of Taxability of petroleum products. The Govt. should try to introduce GST covering all the products and commodities instead of creating confusions.“ 6. Sir, It is long time promise to scrap the Central sales Tax but it appears that the Government wants to continue 1% tax on interstate sales and this is against the Government promise and it is requested to consider the same. 7. KHAGA strongly urges upon to keep food grains, textiles, edible oil and oil seeds on zero tax rate...Readymade garment being a basic necessity needs special attention too....After agricultute, garment industry provides highest employment in India... Respect sir, we as the representatives of the Small Trade and Industry covering karnataka are not against the basic concept of “Goods and Service Tax” but sir the Indian economy and Trade and Industry will get the proper benefit of the GST once it is introduced in its “Standrad Format “and only one indirect tax is introduced instead of this proposed dual GST. We request your good self to start working on a “National Goods and service Tax” under a central collecting agency and distribute the revenue of the same between the states and the Centre and if this is not possible in the present political situations then please postpone the proposed “Goods and Service Tax” for the overall benefit of the Trade and Industry. Thanking you in anticipation. With warm regards SAJJAN RAJ MEHTA CHAIRMAN..TAXATION COMMITTEE KARNATAKA HOSIERY & GARMENT ASSOCIATION (KHAGA) BANGALORE 09845501150