GST bonanza for businessmen, small traders

Not entirely unexpected, but surely not as much of relief, has been proposed to be afforded to small traders and businessmen in Jammu and Kashmir by the State Government which among other slew of relief include Rs. 40 lakh limit for registration as traders under Goods and Services Tax (GST). In other words, the limit has straightaway been doubled from Rs. 20 lakh as at present which means no GST at all to be paid by this segment of traders. The Government also raised the limit of composition scheme of paying a nominal 1% tax from the present limit of Rs. 1 crore to Rs.1.50 crore effective from April 1 this year. In addition to it, services have been included in the GST Composition Scheme to pay just 6% GST as against 18% at present , a straight climb down of as much as of 12%. These measures of immense support to small and marginal trading community shall prove of not only a great financial relief but even give respite from the hassles of indulging in too much of paper work, preparing statements and returns as also the botheration of getting registration.
This comes as a sequel to the realising by the Government a few difficulties faced by the trading community on account of the introduction of the single tax system regime. Taking into account the interests of small and marginal businessmen, the representatives of the State Government had opted for the limit of Rs. 40 lakh and in this direction, Governor Satya Pal Malik had advised these representatives on these lines to ensure that large number of businessmen stood benefitted. The other version purely on economic and financial basis, is that a net revenue otherwise earned to the tune of Rs. 5200 crore annually just on the limit of Rs. 20 lakh, now stood lost to the Central Government. While another Rs.3000 crore per annum loss of revenue shall be caused to the Central government on account of the two decisions under the Composition Scheme.
Noteworthy feature of the measures of relief announced is that while there were two thresholds between Rs. 40 lakh and Rs.20 lakh for exemption from registration and payment of the GST for the suppliers of goods with the facility that one can opt up or opt down depending upon revenue, the Jammu and Kashmir Government opted direct for Rs, 40 lakh to benefit the eligible vast sections of the business community. However, few states had a different view as their assessee base would get eroded and revenue earnings suffered by threshold hike to Rs.40 lakh. Since successive Jammu and Kashmir Governments have been prodigal and less particular towards earning more revenues, it opted for Rs.40 lakh threshold.
That the Central Government has played yet another master stroke in view of the approaching general elections by giving massive relief to the business community cannot be entirely ruled out. Otherwise also, since politics and governance are inter dependent, it goes without saying that the Central Government by providing this relief to the small and marginal businessmen has also deflated the air of the claptrap of some opposition parties feigning sympathies for the trading community just to embarrass the Government, mocking it with levying the tax at “unreasonable higher limits”. Now the opposition would be confined to “done keeping in view the 2019 elections”. Whatever the reasons tagged with the important decision, the fact is that the business atmosphere will get a new fillip and surely a boost.