The introduction of a Goods and Services Tax “GST” in India is quickly approaching and will have an impact on all global businesses. Our friends at Khaitan & Co., one of the oldest and largest Indian law firms, recently put out an alert on GST implications.
Read their alert below.Introduction of GST in India is now imminent in the near future with the Government targeting to pass the Constitution Amendment Bill in Parliament in Monsoon session beginning on July 18, 2016. The consultation process with stake holders on draft GST Law is also underway.
GST is going to impact each corporate and other tax payers the way they do business. GST will have immediate as well as far reaching changes. GST will also have different implications for different sectors.
The proposed GST structure/ draft law raises several questions which need to be addressed such as:
How does GST differ in actual practice from existing myriad tax laws?
What happens to my unutilized credit, tax exemption and pending litigation?
Would GST impact cash flow?
Will my warehousing and distribution policy need a change?
Would I have to reduce/ increase price of my product/ service to remain competitive and profitable?
Would concepts like sale, branch transfer, consignment sale be obsolete?
Whether distinction between goods are services are eliminated?
Do I have to take registration in each state?
How do we gear up to maximize benefits of these changes?