In the last-minute rush for GST-compliance businesses are stumbling upon challenges ranging from accountants’ fees to the need for new email IDs.

At a meeting of small and medium enterprises (SMEs) in Noida last week, a businessman said his chartered accountant had increased fees from Rs 5,000 to Rs 25,000 because GST involves monthly filing.

SMEs have been mainly caught unaware as they expected GST’s rollout to be deferred.

With just four days to go, even the big players which have been preparing for months cannot tick all the boxes on the to-do list.

“Contracts are still being renegotiated and large companies have deployed teams of 20-30 people just for that,” said Neeraj Athalye, who leads the GST adoption drive at SAP.

Since the tax rates were finalised only a few weeks ago, companies were still calculating how to benefit the most from the new tax regime amid some hard bargain.

Many have deferred plans to relocate warehouses, but their small suppliers remain the biggest worry.

Sona Group CFO Vivek Vikram Singh said that 20% of the auto part maker’s vendor base comprising small players is not ready and it will have to provide working capital assistance to some through the transition phase.

“Depending on how they adjust, we may have to take a look at the base six-seven months down the line,” said Singh.

At last week’s SME event in Noida, a businessman from western UP said that his long-term raw material suppliers were resisting enrolling on the GSTN platform.

Unless they register, his company, which is a vendor for a larger company, will not be part of the GST chain. There are several other challenges, such as classifying goods based on codes (known as Harmonised System Nomenclature or HSN codes).

“While we have come a long way in the journey of GST-preparedness, we have the immediate issue of mapping the HSN Codes (provided by CBEC) with the items. It’s proving to be the biggest hurdle for almost every organisation to correctly map item codes,” said Rituparno Mukhopadhyay, Executive Director at consulting firm, PricewaterhouseCoopers.

“Also, since multiple items under one HSN code may have different tax rates, classification of the items is becoming a real challenge.” HSN codes are not mandatory at the time of invoicing, but since businesses need to provide a summary of all HSN codes at the time of filing returns, mapping them correctly from day one is necessary. Not having a corporate email ID can also trip a company’s GST drive.

GSTN has advised against using Yahoo and Outlook as its server is unable to send mails to these IDs, said tax lawyer R S Sharma.

Sources in GSTN, however, said that the problem had largely been resolved. Similarly, there are issues related to issue of provisional IDs and passwords that businesses are worried about.

Source: Times of India