The proposed rules for movement of goods in the goods and services tax (GST) regime, which requires the transporters to generate e-way bills on the GST portal, would involve substantial costs in installing radio frequency identification devices (RFIDs) at several posts. Experts say that there is no clarity on who will foot the bill for the infrastructure.
“I believe that such installation of RFID would be a costly affair. Who would bear the cost of such installations and maintenance among the central government, concerned state government, GST department?” Nangia & Co managing director Rakesh Nangia said.
The proposed system requires a transporter to generate a new e-way bill when the goods are transferred from one conveyance to another. Experts said that it is expected these rules would push the business towards greater transparency and would flush out businesses that are operating beyond the tax net. Further, the requirement for officials to record the summary of inspection within 24 hours would deter unscrupulous inspectors, Nangia said.
Additionally, the government also made public the rules related to assessment and audit last week. Nangia said that while procedural clarity has been provided, the absence of actual forms in the public domain undermines the effectiveness of the rule.
The assessment rules also cover those suppliers who aren’t able to determine the value of the goods of services due to certain ambiguity. Such suppliers can pay a provisional tax by furnishing a bond and a security deposit.
“There are many products that can carry such an ambiguity where the value or goods or its tax incidence may not be clear. For example, goods sold on an airplane, or footwear that can be classified either as sandals or slippers due to a particular style of manufacturing,” Preeti Khurana, chief editor, Cleartax.com, said. She added that a similar provision and procedure for provisional tax already exists in the current service tax regime.