Amit Mitra, former chairman of the GST empowered committee, has called for a complete simplification of the GST tax regime to save the medium and small enterprises of the country.
Terming the present system as a ‘sinking hole of regulation’ Mitra said the compliance burden is slowly driving the MSME sector — the bulwark of the economy providing the majority of employment — out of business.
Mitra, who was also the finance minister of Bengal for a decade, slammed PM Narendra Modi’s claim that the GST has increased the ease of doing business — given the frequent changes in rate structures, rules and laws.
He also called for creating accountability to plug the massive fraud taking place in the GST system. Mitra, who is now the principal chief adviser to chief minister Mamata Banerjee in Bengal, reeled out numbers to buttress his arguments.
“Truth has to be told and here is the truth in data,” he said before pointing out that 741 notifications on GST have been issued till date.
“Out of this, central tax notifications are 395, central tax rate notifications are 148 and the total no of prescribed forms are 178 in GST — this is ease of doing business?”
Mitra asked at an event organised by the West Bengal National University of Juridical Sciences (NUJS) with the All India Federation of Tax Practitioner, Eastern Zone (AIFTP-EZ), and supported by the Bengal finance department.
Mitra then pointed out that 65 sections and 129 rules were amended in the GST. Moreover, rates of 419 items of goods and 99 categories of services were changed till date.
“When you change a rate, the GST network has to process. No wonder there is fraud. Ease of doing business is a myth as far as GST is concerned,” Mitra said at the inauguration of the two-day event to review the five-year old indirect tax regime.
Totalling the fraud till date at over Rs 125,000 lakh crore only on the central government side, Mitra suggested that the GST Council should bring back the federalist spirit and consensus mechanism, which was prevalent in the first three years after formation but now gone missing, to thrash out solutions to the complex problems.