4 min read.Updated: 28 Jun 2022, 01:13 AM ISTAjit Ranade
Design flaws and the Centre’s poor execution mean this tax regime has little to celebrate on its fifth birthday
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The fifth anniversary of the grand rollout of our goods and services tax (GST) will be celebrated on 1 July. The legislation’s passage in Parliament, ushering in the GST era, was made historic with a special midnight session five years ago. The Prime Minister addressed the nation on live television the next day, which also coincided with Chartered Accountants’ Day. Since one of the promises of GST is enhanced tax compliance, thanks to its inbuilt interlocking incentives that deter evasion, the PM warned the black sheep among CAs to desist from looting the exchequer under the guise of clever tax avoidance. Since the memory of demonetization was still fresh, he told CAs that because of data mining, more than 300,000 companies had come under the scanner and a third were found to have been violating Indian laws. By implication, the era of GST would eliminate such tax evasion, and the penalties would be harsh.