THIRUVANANTHAPURAM: Finance minister T.M. Thomas Isaac’s GST-related assurances seem to have mollified a large section of traders. Result: a less than partial response to the dawn-to-dusk shut down called by Kerala Vyapari Vyavasayi Ekopana Samiti. The biggest concern of traders was the fate of the stock they had with them on July 1, when the GST came into force. “The input tax credit has been fixed in such a way that traders will not suffer any losses when they sell at GST prices. The traders will get back the entire amount paid as VAT as credit from the State GST. If they have bills, they will also get full input tax credit for the Central excise paid while purchasing the commodity,” the FM said.
Even if there are no bills, Dr Isaac had promised to pay back 40 per cent of the central excise paid if the tax on the commodity has gone up to 5 per cent or 12 per cent, and 60 per cent if the tax had gone up by 18 per cent or more. “Therefore, it is clear that we will not lose any money,” said C.H. Alikutty Haji, a steel trader in Kannur who had kept away from the strike. The FM has also made it clear that the stock for which input tax credit could be claimed should be sold within six months of the start of the GST regime. “Six months is more than enough, but I have told traders that if at all they are finding it difficult to sell all their old stock by the time, I will raise the issue at the GST Council,” Dr Isaac said.
Traders have also been provided a honeymoon period of three months. “It is only natural that traders will make some mistakes in the transition period. The minister has told us that we would not be hassled by tax officials at least till September 30,” said Jose Joseph who runs a small jewellery shop in Palakkad. The minister’s office, however, clarified that action would be taken if there was a complaint of overpricing. The minister’s office also clarified that traders had not been granted any right to put up a new MRP stocker. “There has been a slight confusion but we have told traders that only manufacturers, those packaging at the first point, and the importer have the right to do it. This, too, they can do only after issuing advertisements in two dailies,” the minister’s office said.
