Wary of hiccups, but traders welcome Goods & Services Tax

ET speaks to traders in Delhi, Mumbai, Kolkata and Bengaluru to Gauge their mood ahead of the rollout of GST

Delhi
NEW DELHI: The streets of Chandni Chowk, one of the oldest and busiest trading centres of the Capital, were abuzz with anxieties over goods and services tax this week as the country got ready to embrace the new indirect tax system. For three days, Ghanta Ghar — which in the middle of Chandni Chowk serves as a mainstay for this market — has become a hotspot for traders and businessman protesting the rollout.

Seeking exemption from GST for a year, some 5,000 wholesale cloth merchants at the 150-year-old Kapda market also shut shops and staged a dharna at Ghanta Ghar. “We are seeking an exemption for a year as we have not been given enough time to prepare for the roll out,” said Bhagwan Bansal, who heads the wholesaler cloth merchants’ association and runs his family business from Shehenshahi Katara in Chandni Chowk.

GST on cloth merchants was announced on June 3 and traders claim they need training in handling the paperwork before the new tax regime comes into effect. “Most traders function in very basic conditions and follow the old marwari and munim system,” said Suresh Bindal, another trader in the market, speaking about the reforms in billing and filing returns under GST.

“There are Internet problems; how do we digitise our transactions?” Fifty other trade organisations in the area also went on a strike on Friday. Sanjay Bhargav, who heads the Sarv Vyapar Mandal in the old city, said. “GST will hit many small-time traders and the government needs to take that into account.”
- Aanchal.Bansal@timesgroup.com

Mumbai
MUMBAI: Dharmesh Jain has been managing his father’s business for the past 50 years. In all these years, he doesn’t remember even once shutting his hardware shop in Central Mumbai except for the weekly holiday. He shut his shop this week on Tuesday and was waiting for the rollout of GST on Saturday to reopen it.

“The shop will remain shut till Friday, as I have exhausted my old stocks and I want to buy the new stocks only after GST comes as I have been hearing that there will be problems for the old stock once the GST comes,” Jain said. He doesn’t mind the losses he will suffer due to the closure. Across Mumbai, Thane and other cities in Maharashtra, many traders had closed their shops or simply were not buying any new stocks due to concerns over GST. Mohan Gurnani, chairman of the Chamber of Associations of Maharashtra Industry and Trade, welcomed GST but echoed what the builder was saying on shops emptying their stocks. “Restaurants, even chemists and kirana store owners, are not buying new stocks as they want to finish off their old stocks,” said Gurnani.
— Krishna.Kumar@timesgroup.com

Kolkata
KOLKATA: The feeling was mixed among Kolkata’s traders as they waited for the GST rollout. While there was confusion among some, especially small retailers, about the process that they need to follow in the GST regime, many others were optimistic about the new tax system. Pawan Nariyani owns four shops in New Market and two weeks back he started a new business in garments and jewellery.

The 35-year-old expects GST to be beneficial in the long term. “This is a reform and all businesses initially wanted this reform to happen. There will be some initial hiccups, but that would settle in a few days,” he said. J Haldar, manager at the 115-year-old Jewish bakery shop Nahoum’s, thinks otherwise. “There are some practical and operational issues we are facing. These issues are not yet addressed.

Earlier there was one tax and now it would be another. So, the extra part, we have to bear for the time being. We cannot charge our customers for that till we go for a price revision,” he said. “But, there is another issue which is more serious than suffering losses. We deal with the informal sectors. Most of the items we source are perishable. For that we cannot claim input tax credit. So, as of now, it appears to be a double-edged sword for us.” Similar concerns were expressed by other sweetmeat shop owners as well.
- Madhuparna.Das@timesgroup.com

Bengaluru
BENGALURU: Traders in Bengaluru’s Chikpet area, who are among the oldest residents and earliest migrants into the now bustling metropolis, are staunch BJP supporters and want GST to succeed. They have put aside the old distrust that GST evoked, when the Congress-led UPA proposed the tax system. To put it in the words of a 60-year-old jewellery merchant in the area: “Modiji has endorsed it. Everything will be fine.” But under the opening bravado, there appears to be a logistical nightmare that the trading community is dreading.

“All the last few days, we have been scrambling for details and information,” said Hosiery Association president Sajjan Raj Mehta, who feels GST has turned into a premature baby rather than a full-term one. “We have been discussing GST from 2008. Everyone has agreed to it, the laws are being passed by the states also. Why can’t we put in place all the infrastructure and training needed, before we launch it,” he asked. Traders are not happy with various slabs of taxation.
— Sowmya.Aji@timesgroup.com