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The first two weeks since the launch of the goods and services tax (GST) seem to have gone by without any major disruptions in the economy. Supply chains seem to be working quite well. Credit is due to the government officials who have been overseeing the difficult transition in the tax system. The technology backbone, the GSTN, has also worked without any glitches.
These are still early days, and the true extent of the success will only be known when the first online GST returns are filed in September. The chances of muddles should not be dismissed. Remember that the online rollout of the Affordable Care Act in the US—Obamacare—was not free of technical glitches. It is important that the principle of regulatory forbearance is used for the first few months of the new indirect tax regime.
The government needs to instruct the tax department that firms who have made mistakes in their tax filings should not be automatically treated as evaders. Honest mistakes are very likely. A heavy-handed approach is not needed at this juncture.