Tax Experts Expect The GST To Boost The GDP By 2%

Quality of the tax system in India would become better because of the coming of the GST. This is because the burden of the tax system would get redistributed equitably between the Top GST Consultant In India services and the manufacturing. A study for finding the impact of the GST on the growth of the GDP and exports was conducted by the NCEAR on the request of the finance commission.

The study explored the impact of the GST on the growth via two methodologies-the direct cost reduction methodology and the cost reduction on the inputs of the capital methodology. The results revealed that the growth in the GDP could be about 2 to 2.5 %. The exports might get increased by about 10 to 14 %. This indeed is an astonishing increase.

There seems to be a belief that the growth in the GDP to be two would be the best option. A single rate, Ind AS Implementation the GST would lead to low costs of compliance, eliminate disputes of classifications and ensure approach’s uniformity amongst all the players. The rates should also be sufficed to be able to address all the concerns of the states associated with the revenue. In fact, the neutrality of the state revenue would be imperative.

For the success of the GST, all the states as well as the centre would require the implementation of the GST in the same manner. Through this only, the national common market could be made. The GST is the single major tax reform post 1991-92. India’s fiscal system Tax Advisory Services In India would possess the cutting edge after the flawless GST and the new direct code of the taxes. The profits get increased by 20 percent only by 2 percent reduction in the costs. This would lead to the investments. Industries because of the low costs due to the disappearance of the cascading taxes would invest more and enhance the growth rate.

For queries associated with GST, GST Implementation, Roadmap to GST and GST Rates in India. contact AKGVG and Associates and CAC India at. +91- 9811118031

Does Neglecting The Process Of Bookkeeping Have A Direct Adverse Effect On Your Business?

Have you ever been unable to maintain your books? Did you receive an unexpected tax bill? Were you unable to understand the financial? Further, were you unable to take appropriate corrective measures? Well, according to CPA, Australia the inability of certain businesses to Financial Control In India maintain the financial s resulted in the financial mismanagement making the entire business fail. Also, certain businesses not possessing any accounting record or weak accounting record also failed completely.

What do you understand by bookkeeping?

 Bookkeeping is the process of recording the company’s financial transactions. This recording helps in classification and analyzation of data for taking appropriate business decisions. For a healthy and a long lasting business the following are the reasons for the bookkeeping to play a vital role-

1. Excellent financial analysis and management

 Proper focus on the cash flow management irrespective of your being busy or idle can help you know whether the invoices are delayed or not, whether proper follow-ups on customer payments are being done or not .Your inability to track your records will delay invoices further delaying payments of the customers resulting in falling out on supplier’s list of customers and finally, making you crash down.

2. Fulfilment of Tax Obligations

for accomplishing the appropriate filing of the annual taxes, imperative information and documents are required. Not maintaining the books makes it extremely difficult for you to remember expenses and find the bills. At the time of filing tax return the tax advisor would spend time in Company Registration In India formulating an appropriate strategy for you to file returns rather than thinking about making and correcting the entries. Bookkeeping helps in maintaining an organized Balance Sheet, Cash Flow and Profit & Loss.

3. Reporting financial strategies to the Investors becomes Easy

Investors require enormous information about the financial strategies being implemented by the businesses. Without bookkeeping revealing the important information about the financial status of the company becomes difficult. Hence, preparing charts and graphs for listing the data becomes impossible without the bookkeeping.

4. Business Planning becomes Easy

Balance sheet and profit and loss accounts are important for knowing the financial status of the company. This helps the company in evaluating the current status of the progress of the company and Formation Of New Company whether the company is heading in the right direction for accomplishing its goals or not. This makes further planning of the business easy.

5. Proper Record Keeping as Required by Law

bookkeeping keeps record keeping properly organized from small to big invoices. It makes retrieving process easy when the audit time comes.

Keeping a record in a properly organized manner, from small invoice to big invoice, helps in retrieving the entire information. During the audit, the important financial s are required and due to the retrieving process the company manages to produce the information required by the auditors.

Bookkeeping helps you to do tax planning effectively, foresee your cash needs, avoid the surprises being given by the Audit Outsourcing year end taxes, make appropriate changes in your business making your business more profitable and increase the cash flow.

Aren’t these reasons sufficient for you to hire an accountant for maintaining your books? Contact AKGVG & Associates for maintaining bookkeeping to be able to make your business earn handsomely.

GST - The Road Ahead??

It seems that the government is prepared to implement the GST from the 1^st April, 2017. Implementation of the GST would require the transformation of the business. Introduction of the GST would Roadmap To GST Implementation require review as well as the change of the supply chain, tax positions, accounting, business processes and enterprise resource planning (ERP) systems. The time for the implementation of the changes is quite limited.

The introduction of the GST would bring an increase in the tax compliance obligations.

Today, a service provider having operations in twenty states can get a single centralized service tax registration but under the GST a separate registration would be required for every state. A service provider who is filing about three service tax returns per year would have to file four to five returns per state per month. This tentatively comes out to be 100 returns per month. 

A manufacturer having two factories and having operations in 20 states would approximately have 23 registrations at present (one service tax, 20 value added tax, VAT and two excise). Under the GST the registration’s number would reduce to 20. (1 for each of the state). On the other hand ,there would be an increase in the number of returns from 22(20 VAT returns and 2 Excise returns) to 100 (four to five returns per registration) per month.

GST - Are the companies prepared?

Though the monthly returns under GST would comprise of the statement of procurement and statement of supplies yet they would not only have to be prepared but also filed separately on the date specified.

As per the present law, the purchase-sale reconciliation is a requisite only for credits under the law of the VAT of only Audit Outsourcing certain states. Such reconciliation isn’t required for the Service and excise tax laws. However, after the implementation of the GST, the procurement of the taxpayers would have to be reconciled with the vendors’ sales and goods. Services’ supply would also have to be reconciled with the purchasers every month; for avoiding imposition of the liability of the tax and denial of tax credit of the input.   

For each state, GST of three different types (state GST, central GST and integrated GST) would have to be maintained as separate credit pools. The requirement for these three separate credit pools is because of the availability of the GST paid on procurement as credit against Ind AS Implementation GST liability of the output. A company possessing operations in 20 different states would have to be having 60 credit pools as compared to the 23 credit pools. The Company would also require 60 output tax accounts instead of 23 output tax accounts.

The increased compliances would enhance the transparency and the result would be positive on the Indian economy. The industry need to set in place the appropriate ERP systems and the appropriate processes for handling the change the GST would bring.

GST - FMCG Items To Become Cheaper In India

Tax experts state that the present practice is of tax on tax that is; VAT is charged on the cost of production. Additionally, VAT is also charged on the excise duty added at the gate of the factory making the cost go up. This tax on tax would get eliminated after the Top GST Consultant In India implementation of the GST. The result of this would be the reduction in the cost of many products. These products range from FMCG to the garments.

As per the tax experts the essential services like the cultural activities, the Ambulance, pilgrimages and the events of the sports  would become expensive as  the present rate is 14.5 percent and this rate would get enhanced to 18-22 per cent.Hence,the cost of traveling, eating out, banking, hiring cabs, watching movies, buying branded jewelery, watching IPL would all rise.

The present taxation system that is based on the production would undergo a change and would become a consumption based system. Since the VAT and the excise duty would reduce from 25-26 percent therefore, the manufactured consumer goods would become cheaper. The cost of the services would increase from the present level of 15 percent.

At present, about 25 to 26 percent of the cost above the cost of the production is being paid by the consumer. This is because of the value added services (VAT) and the excise duty (about 12.5 per cent). Though there is no indication of the changes to be brought because of the GST Accounting Audit Service yet tax experts state that it’ll be somewhere between 18 to 22 percent. This, considering all the possibilities, would bring down the cost of the basic goods. Certain items that are considered to be essential are not taxed today and are expected to remain out of the bracket of the tax even under the GST.

The manufacturing hubs of FMCG products get impacted because of the state/excise schemes. Under GST, there are possibilities of the manufacturing locations to get readjusted because of the commercial perspective and this readjustment might impact the prices of the goods. An excise duty of 12.5 percent and a VAT of 12.5 to 15 percent are attracted by the goods depending on the state. Further, there are varied taxes like the input tax credit retention, CST, entry tax, Octroi, etc. till the product reaches the consumer.

After the implementation of the GST, the overall indirect cost would get reduced extensively and the credit flow Ind AS Implementation In India would increase for the manufacturers. This might reduce the cost of the production and increase the profits of the base line. This would provide room for the reduction of the prices for the end users.

For seeking suggestions on GST & IND AS and Roadmap To GST & IND AS Implementation, contact AKGVG & Associates in New Delhi India