During a seminar on goods and service tax (GST) organised in Chennai by the Confederation of Indian Industry (CII), Venu Srinivasan, chairman and managing director of TVS Motor Company, a leading two wheeler manufacturer, shared that GST will enhance the competitiveness and efficiency of the manufacturing sector (which houses a substantial number of SMEs) and mitigate the cascading effect of the current tax system. “GST will have many benefits, and though there are also concerns, they can be removed,” adds Srinivasan.
Sachin Menon, head of indirect tax at professional services firm KPMG, said the GST is a “mixed basket” for SMEs. “Like any other tax law, it brings good news for this sector along with some restrictions as well.” Once GST is introduced, he added, SMEs would be in a position to avail themselves of the complete input credit for taxes paid (other than basic Customs duty) on procurement from various sources such as import, inter-state purchases and local purchases.
