Even as GST completes one year, Harsh Mariwala of Marico says that the pain associated with the learning curve of the new indirect tax regime is now behind us, and it is now time to reap the benefits.
Even as GST completes one year, Harsh Mariwala of Marico says that the pain associated with the learning curve of the new indirect tax regime is now behind us, and it is now time to reap the benefits. Harsh Mariwala, Chairman of the Rs 44,000 crore FMCG giant Marico says that going forward, the GST tax collections will certainly improve and tax evasion will come down. In an interview to CNBC TV18, Harsh Mariwala noted, “Going forward- the GST tax collections will increase, the tax evasion will come down, the e-way bill has gone smoothly I would say.” Notably, the veteran industrialist also said that SMEs have now learnt to cope up with the complexity of GST. We bring to you three key takeaways from Harsh Mariwala view about GST, even as the new tax regime completes one year.
GST- the journey so far
“I would say initially there was some desticking in the month of June-17, after the GST was launched. But, we are by and large back to normal today. I think all the sectors, at least in FMCG are back to normal. It’s a year where GST has evolved, and I’m quite optimistic about GST, and the likely beneficial impact of the GST on the Indian economy,” he told the channel.
Taking stock of the journey of the new indirect tax regime, Mariwala noted that it has taken 10 years of planning for the launch of GST, right from the idea to its implementation. “There are multiple stakeholders in the GST, different political parties, the trade industry, the consumer etc. The finance minister had a very difficult job to arrive at a consensus. The speed agility was important. One has to view the GST in that context,” he said.
GST- collections to improve going forward
After the various indirect taxes got subsumed in to the GST, Mariwala noted that right from the rate, the forms, the classification, refunds, anti-profiteering fears, compliances, on each of them, there has been a positive move. “I’m seeing that as a very strong positive. Going forward- the GST tax collections will increase, the tax evasion will come down, the e-way bill has gone smoothly i would say,” he said. According to the expert, the things are back to normal, the future course of the tax collections will depend on how the economy fares. “The negative impact of GST is gone now. We had to go through that learning curve. If the government could simplify all the forms, it could lead to better compliances. Some new sectors, petroleum and real estate can come under the ambit of GST,” he observed.
Impact on SMEs
One of the major positives of the GST has been the formalisation of the informal sector. In this, the contribution of MSMEs has been immense. In the interview he noted that SME’s have learnt to live the complexities of GST. “We deal with MSME distributors. They are our partners, we have to hold their hands. Now the SMEs have also learnt to live with GST, and the complexity to file returns has now improved. So unless somebody is doing tax evasion, the ability to collect taxes has now improved,” he said.