Implementation of GST regime and ensuring a smooth transition from the current regime is indeed a mammoth task for the Indian government. Nonetheless, the government is leaving no stone unturned.
Instead of taking one giant leap and imposing everything at one go, the government is trying to take small steps towards their ultimate goal.
In an attempt to create a conducive environment for the acceptance and implementation of GST, the government today hinted towards increasing the threshold limit of Service Tax exemption from Rs. 10 lacs to Rs. 25 lacs.
This would not only mean less compliance for small businesses but would also help in bringing their cost of services down enabling them to compete and survive in today’s challenging environment.
The step as proposed to be taken will not only boost small businesses and enterprises but would also mean moving a step ahead towards GST implementation as the increase in exemption limit will be in accordance with GST.
The move will further help authorities to get adapted to the new tax regime. It will also give time to the concerned authorities to focus on big tax payers.
Apart from Service tax, CENVAT also needs to be considered. It is required that it also be aligned to the GST limits for smooth functioning but that seems difficult before GST is implemented.