GST Implementation Challenges Across Industries: Insights From Aadi Corporate Advisors Llp

The introduction of the Goods and Services Tax (GST) in India aimed to simplify the tax system but brought unique challenges for various industries. At Aadi Corporate Advisors LLP, we specialize in providing expert guidance in accounting, tax advisory, corporate restructuring, and virtual CFO services. Here’s a concise look at the primary challenges and our solutions for different sectors.

Manufacturing Industry

Input Tax Credit (ITC) Complications: Manufacturers face challenges in claiming ITC due to dependency on suppliers for accurate documentation. We streamline this process, ensuring timely and accurate ITC claims.

Compliance Burden: Multiple monthly return filings increase the administrative load. We manage compliance efficiently, especially for SMEs, ensuring all deadlines are met.

Classification Issues: Misclassification of goods can lead to incorrect tax rates and penalties. Our experts ensure proper product classification, minimizing legal risks.

Service Sector

Taxability of Composite and Mixed Supplies: Determining the correct GST rate for bundled services is complex. We provide clear guidance on taxability, ensuring compliance.

Interstate Services: Determining the place of supply for interstate services can lead to errors. We help correctly identify the place of supply, avoiding incorrect tax payments.

Reverse Charge Mechanism: Service providers must navigate the reverse charge mechanism, adding complexity. We ensure seamless compliance with this requirement.

E-commerce Industry

TCS (Tax Collected at Source) Compliance: E-commerce operators must manage TCS on taxable supplies, adding compliance burdens. We assist in maintaining detailed records and timely remittance.

Vendor Coordination: Ensuring GST compliance for numerous vendors is challenging. We provide support in managing vendor compliance, easing administrative tasks.

Return Filing: High transaction volumes make return filing complex. We ensure accuracy and timeliness in reporting, simplifying the process.

Real Estate and Construction

Transitional Provisions: Shifting to GST created confusion for ongoing projects. We guide clients through transitional provisions, ensuring smooth compliance.

Input Credit Utilization: The sector struggles with availing input tax credits. We optimize input credit utilization, enhancing financial planning.

Increased Cost: GST initially increased costs for under-construction properties. We offer tax optimization strategies to manage and reduce these costs.

Pharmaceutical Industry

Supply Chain Disruptions: Pharmaceutical companies had to realign supply chains for GST. We offer solutions to minimize disruptions and ensure compliance.

Rate Classification: Classifying drugs and medical supplies for GST is complex. Our experts ensure accurate classification and compliance.

Export Benefits: Claiming GST refunds is cumbersome for exporters. We streamline refund claims, improving cash flow and working capital.

Conclusion

GST has streamlined the tax system but brought challenges across industries. At Aadi Corporate Advisors LLP, we provide tailored advisory services to help businesses navigate these challenges, ensuring compliance and optimizing operations. As GST evolves, we remain committed to supporting our clients in this dynamic landscape.