GST @ 7

India's Goods and Services Tax (GST) would complete a significant milestone of 7 years of implementation on July 1, 2024. This reform has overhauled the the indirect tax landscape leading to buoyant GST collections exceeding INR 20.14 trillion in FY 2023-24. This robust performance signifies India's economic resilience and paves the way for GST 2.0 – the next phase of GST reforms.

Deloitte's latest survey report, "GST @ 7 Years," draws on a comprehensive online survey conducted with C-suite and C-1 level executives across various industries and company sizes. A total of 760 responses were obtained from six key sectors: Consumer, Energy, Resources and Industries, Technology, Media and Telecommunications, Banking and Financial Services, Government and Public Services, and Life Sciences and Healthcare.

We are pleased to present our report that delves into the following key areas:
A. Road to GST 2.0: Charting the next phase of GST reform
B. Striving for excellence: Improving ease of doing business and effective dispute resolution
C. Maximizing impact: Leveraging GST data and optimizing facilitation / compliance
D. Streamlining the GST framework: A focus on MSMEs
 

The report highlights the significant strides made in GST implementation, reflecting an enhanced positive sentiment and growing confidence in the system. According to the survey, 84% of respondents recognise the positive perception (up from 59% in GST @5 and 72% in GST @ 6) of GST, paving the way for reforms in GST 2.0.

Key operational benefits include competitive pricing, with 73% (up from 56% in GST@5 and 61% in GST @6) citing it as the greatest advantage.

Top performance areas remain the automation of tax compliances including e invoicing initiatives. Priorities for GST 2.0 include rationalising GST rates, measures to improve dispute resolution, removal of input tax credit restrictions, unlocking of working capital, introduction of faceless assessment and vendor compliance rating.

The report also underscores the need for simplifying the ease of doing business, particularly in adjudication/ audit proceedings including the need for removal of parallel/ multiple proceedings. and expansive legal interpretations. Leveraging GST data for unlocking business insights and introduction of the long-awaited compliance rating system are also high on agenda in taxpayer minds.

From an MSME standpoint, there is strong support for considering seamless registration process and paperless invoicing.