Source | The Hindu
Multi-location service providers such as banks, telecom operators, airlines and insurance companies are staring at huge compliance burden with the Goods and Services Tax (GST) set to become a reality soon.
These service providers would need to take State-wise registrations in place of current centralised registration, file monthly returns instead of six-monthly increasing the compliance manifold, say tax experts.
The Central GST Bill — as passed by the Lok Sabha — in the current form does not specifically exempt services sector from obtaining separate registrations for each State from where supply takes place, they noted. Therefore, such companies will have to seek multiple registrations.
R Muralidharan, Senior Director (Indirect Taxes), Deloitte in India, said it was imperative to grant centralised registration facility to service providers operating in multiple States to reduce compliance burden.
“Currently, a service provider operating in 20 States can operate with one centralised registration and is required to file two returns in a year,” Muralidharan told BusinessLine.
Against this, under GST, they need to get registered in 20 States and file close to 740 returns in a year, he added.
Archit Gupta, founder & CEO, ClearTax.com said that multiple registrations for services companies will increase their compliance manifold.
“A minimum of 37 returns for each State in which they are registered, will have to be filed. We hope the industry-specific groups set up under GST by the Finance Minister will take a deep look into this issue,” Gupta added.