AIDCTA is suggesting that government should listen to trader’s voice for One Industry, One Tax for easy of business and issuing the clarification which is required for avoiding confusion.
The Government has rolled out the nationwide Goods and Services Tax (GST) on July 01, 2017. However, the variable tax slabs on IT products has created a cause of concern among the IT Channel Partner community of India. Keeping a note regarding the concerns of Partners, All Delhi Computer Trader’s Association (Regd.), Nehru Place has represent the Information Technology Market of India as Nehru Place Market is an India’s Biggest IT Market has handed over a letter to Hon’ble Finance Minister – Shri Arun Jaitley for issuing the clarification on ambiguities. The letter also to suggest government should listen to trader’s voice for ONE Industry. One Tax for easy of business.
In light of fact that Government of India rolling out countrywide the new tax regime of GST from July 01.t 2017, AIDCTA request for issuing the clarification which is required for avoiding confusion to the Govt. of India. In Today’s hi-tech era, computerisation plays a pivotal role in the Socio-economic and integrated development of the country. In every spare of life – starting from education to health services – application of computer is increasing day by day.
More so, after the GST comes and much new organization or even many individuals will have to use computers to file their returns regularly. Imparting computer knowledge is also emphasized by our Hon’ble Prime Minister Sh. Narinder Modi Ji for building up DIGITAL INDIA. It requires a large number of a highly skilled professional for the growing economy.
The members of the All Delhi Computer Trader’s Association are seeking prime minister’s kind attention in regard to promoting the advantage of GST in the Progressing World.
Here is a copy of the letter that AIDCTA send to Arun Jaitley.
Letter-1 :
Sub: Request for issuing the clarification which is required for avoiding confusion.
We, on behalf of All Delhi Computer Trader’s Association (Regd.), Nehru Place represent the Information Technology Market of India as Nehru Place Market is an India’s Biggest IT Market. Please consider our following representation for immediate action:
1. Reverse Charges on Purchase of Goods from Unregistered Dealers:
IN case purchase of goods by Registered Dealer from unregistered Dealer Reverse charges i.e. applicable GST requires paying by a Registered dealer. You are requested to clarify Whether Reverse Charges ( GST on purchase of goods from unregistered dealer ) require paying in same month of purchase of goods or payable at the time of sale of said goods ( maybe after 3-4 months )
2. Relaxation in Penalties arises from Ambiguity in selecting HSN/ASC codes.
In Computer Market it is very common practice to buy used Laptop, Personal Computer, and their peripherals and then sell their components individually.
For Instant Purchase of Laptop PC is covered under HSN Code 8471 and by splitting of this laptop it will generate Different Components like Mother Board ( 8473 ), HDD ( 8471 ) Battery ( 8507 ) Adaptor ( 8504 ) etc. Due to this ambiguity, it is almost impossible to correlate purchase and sale w.r.t. their respective HSN Code.
In addition to above dealers are buying computer components from a different supplier who may supply same item having different HSN code resulting mismatch of purchase and sale. Due to facts mentioned hereinabove our Computer Industry presently under a lot of pressure, therefore you are requested to kindly relax the HSN code implementation to the dealers / small vendors.
3. Duty on 2 or more products is 18% but when combined in one it is 28%
Your kind attention is drawn towards BOM of Personal Computer (8471) wherein components like Mother Board (8473) HDD ( 8471 ) SMPS (8504) and Battery (8507) are finished products also. Almost Every Vendor Buy these components are may sell these components or may assemble the PC as per the demand of the customer. GST on PC is 18% whereas some components have GST 28% therefore after assembling of PC many components of GST @28% will turn to GST @18%. You are requested to kindly clarify Whether GST @ 18% for Assemble of PC (8471 ) is permissible despite having components which are covered under GST @ 28%.
Most respectfully submitted that due to the facts mentioned hereinabove most of the dealers of our industry are in a panic and hesitating to sell their products. Therefore, your immediate action is solicited for issuing a clarification and other action as deemed fit.
We understand that as it is the starting phase of this major change, there is always a scope of Corrections, Please do the needful for the betterment of the Indian Industry.
Letter-2 :
Sub: Hindrances in GST Regime, in spite of many conferences & seminar to solve Ambiguity.
We, on behalf of All Delhi Computer Trader’s Association (Regd.), Nehru Place represent the Information Technology Market of India as Nehru Place Market is an India’s Biggest IT Market.
In Today’s hi-tech era, computerisation plays a pivotal role in the Socio-economic and integrated development of the country. In every spare of life – starting from education to health services – application of computer is increasing day by day.
More so after the GST comes and much new organization or even many individuals will have to use computers to file their returns regularly. Imparting computer knowledge is also emphasized by our
Hon’ble Prime Minister Sh. Narinder Modi Ji for building up DIGITAL INDIA. It requiring a large number of a highly skilled professional for the growing economy.
To make it affordable to all, we request you to reconsider the following request of the IT Market:
(1) Equalising Rate on some integrated parts buying separately, e.g.
Laptop/Tab/Mobile Batteries (as not same as Lead Acid / VRLA Batteries as it is labelled GREEN & Pollution Free) and Adapters are an indispensable part of Laptops/Tab/mobiles and is treated as Consumables as it deteriorates with time and to be replaced may be twice/thrice in the products life.
On product – tax is 18% but on replaceable, it is 28%. There should be no logic to make it different.
(2) Relaxation in Penalties arises from Ambiguity in selecting HSN/ASC codes.
As HSN code was originated for Manufacturer use, there is a limited classification catering local country’s need. With the change in time and need, many product’s shape/utility changes especially in IT Industry where the Development is the KEY. Hence, there should be Relaxation. To the Tax Payer, if he chooses different HSN/SAC code than what his predecessor’s supplies are putting in GST Return. The Difference arises due to Old Stock as it is Transition Phase. Hence Relaxation for few months (preferably till Dec. 2017 ) to be granted due to TRANSITION Phase.
(3) Duty on two or more product is 18% but when combined in one it is 28%
Say for example Printer + Scanner, whereas in Electronics as miniaturized / portability issue almost every independent device is a multifunction device. e.g., Mobile. Another example is: Coaxial cable and Optical Fibre cable is in 18% slab whereas Lan/CCD TV use cable is in 28% slab as 2 or more set of pairs joint together. Hence all those should be in 18% tax slab.
(4) The tradition of Classification should not be changed.
Cables like USB cable, HDMI Cable, etc. which was previously in 5% Tax slab as Computer’s Accessory, hence it should also come in 18% slab and not in 28% slab. Similarly like headphones, small speakers was in 5% slab but that too now was put in 28% slab though it is a computer accessory.
As the Government says that as it is the starting phase of this major change, there is always a scope of corrections and modifications, please do the needful for the betterment of the society considering the following universal facts:
- MORE TAX, MORE THEFT.
- MORE AMBIGUITY, MORE INSPECTOR RAJ.
- MULTIPLE TAX IN ONE PRODUCT PROMPTS TO IMPORTS GOODS AS ONE TAX DEVIATES US TO FOLLOW THE CONCEPT OF “ MAKE IN INDIA”.
(e.g., Nobody will Mfr. Laptop battery and even laptop, if on battery tax is 28%, whereas on whole laptop tax is 18%)
- ABNORMAL INCREASE IN TAX MAY LEAD TO BOYCOTT OF THE PRODUCT OR COMPLETE TAX EVASION. ,
(e.g., a lot of products like USB/HDMI cables, LCD, etc. had 5% tax and even calculating 12.5% excise, it comes 17.5% approx is now put in 28% tax slab.
- “Relaxation in Tax” helps in adoption.
By keeping the Lower Tax rate on Computer and Information Technology Products, you will make an immense contribution in building up a prosperous and really growing economy that will lay the solid foundation for building a just and equitable society.
