The bill will empower the success of mega economic and social projects, especially Digital India and Start-up India
BestMediaInfo Bureau | Mumbai | February 25, 2016
Digital industry body, Internet and Mobile Association of India (IAMAI) has urged the Parliament to pass the GST Bill in the upcoming budget session of Parliament. The body has said that the bill will be crucial in the success of mega economic and social projects, especially Digital India and Start-up India. The bill is said to subsume all indirect taxes to create one rate and integrate the country into a single market and would be the biggest tax reform that will be undertaken since Independence, but is pending approval of the Rajya Sabha.
The Digital India plan is about connecting, empowering and enabling citizens to encourage local electronic manufacturing. On the other hand, Start-up India is focused on promoting entrepreneurship through small entrepreneurs. Both mega projects rest on the successful passage of the GST bill in the Parliament.
According to the body, the extant tax structure of India is heavily fragmented, with various indirect taxes levied by different authorities at different stages of a transaction. Fiscal federalism has led to different procedures and rates of VAT and other forms of LBTs across the states. This chain not only creates logistical challenges for the industry, but also gives rise to compliance related complications. There have been conflicts of interests among tax authorities in case of inter-state transaction which is a major concern for the industry today. The passage of GST will help the digital industry business model to flourish by providing uniformity in tax rates and regulations across the country. It will also ease business in India and allow free-play to market dynamics and allow deeper penetration of these services.
Apart from that, many of the developments in the digital industry are disruptive innovations. Business models like online platforms, aggregators, etc. are essentially services provided by intermediaries and such services are revolutionising the existing markets. Therefore, online ticketing services or e-tailing are providing newer modes of access for consumers to existing goods and services.
The body hopes the smooth passage of GST in the upcoming budget session, as further delay will push back the transformative projects of the government.