Delloite GST@7 survey - Rise in positive perception of GST

According to the recent GST@7 survey by Delloite, taxpayer confidence regarding GST is rising. Approximately 84 percent of the respondents reported a positive perception of GST in the year 2024, which is an increase from last year’s 72 percent and 59 percent in 2022.

The survey identifies areas needing further reforms: rationalizing tax rates, providing an effective dispute resolution process, removing credit restrictions, adopting faceless assessments, liberalizing export rules, and implementing a compliance rating system. These recommendations are expected to be key discussion points at the upcoming GST Council meeting on June 22, 2024.

It has been 7 years since the GST has been a part of the Indian Taxation policies. This survey also brought forward that 88 percent of top C-suite leaders identified challenges in audits and assessments, highlighting the need for continued simplification, technology integration, and capacity building.

There is widespread feedback for effective dispute-resolution mechanisms, with 91 percent of leaders supporting the extension of audit timelines to address issues and improve compliance. Additionally, more than 70 percent of respondents advocated for aligning pre-deposit requirements for GST appeals with pre-GST norms to streamline the dispute resolution process.

Mahesh Jaising, Partner and Leader, Indirect Tax, Deloitte India, shared his views, “India Inc. has enhanced confidence in the workings and efficiency of the GST regime. Such positive sentiment is reflective of supply chain efficiencies, the benefits of tax, technology, and continued stakeholder engagement on GST policy matters. The survey reveals that it is time to push for further reforms to make the regime more robust, dynamic, and responsive to taxpayers’ needs. GST 2.0 should 2 review the possibility of expanding the GST regime’s tax base, rationalizing tax rates, removing ITC restrictions, further export liberalization for services, unlocking working capital, and addressing concerns related to operational areas of compliance.”

Furthermore, he added, “At 88 percent of respondents, is to move towards a faceless assessment system. Going further, the survey calls out that the digital tax platform/administration gives ample scope to use the data gathered for critical business analytics and market insights. About 95 percent of India Inc. leaders strongly advocated putting in place a compliance rating system and felt that it was high time that seamless integration across tax systems is achieved.”

To support the Micro, Small, and Medium Enterprise (MSME) sector, the survey suggests easing GST registration by implementing streamlined processes like virtual verification and standard documentation nationwide. These measures aim to help MSMEs navigate compliance challenges and contribute more effectively to India’s economic growth.

The survey highlights the impact of GST on various sectors, with 73 percent of respondents recognizing competitive pricing of goods and services as a significant positive outcome. Industry leaders continue to prioritize the automation of tax compliance, followed by enhanced stakeholder engagement and the issuance of clarificatory circulars and instructions.

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