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This refers to the article, “Rushing to get last mile delivery right” by Paran Balakrishnan (June 14). In its concluding observations in 2016, the Committee headed by Chief Economic Adviser Arvind Subramanian on possible tax rates under the Goods and Services Tax described the tax as a game-changing reform that would facilitate “Make in India by Making One India”.
The Goods and Services Tax can not only help improve governance and strengthen tax institutions but also impart buoyancy to the tax base.
However, the tax rates arrived at by the GST Council are higher than the current service tax rates for certain goods and services. This would lead to an increase in cash outflow and constrain liquidity in the business.
Also, in the new tax regime, credit of input tax will be available on the basis of matching concept.
If there is a mismatch in details as provided by the supplier/vendor vis-a-vis those provided by recipient, then input tax credit would be disallowed and the latter might have to pay tax (equal to input tax credit) along with interest.
There might also be an increase in the compliance cost due to decentralised registrations which will affect the working capital needs of small businesses.
Further, the GST Council is yet to provide clarification on certain place of supply and time of supply rules and the anti-profiteering framework which might further affect the ease of doing business.
The impact of GST cannot be realised fully unless a robust communication and logistics infrastructure is in place. It is time the Government reassessed its preparedness for its transition.
Shreyans Jain
Loan waivers futile
This refers to your editorial ‘Double standards (June 14). The nationwide loan waiver announced by the Janata Dal government headed by VP Singh in 1990 has become a precedent. The concept was picked up by the UPA in 2008; these bounties proved an exercise in futility.
Loan waiver is just a quick fix and does not address the root cause of agrarian distress afflicting the country even a wee bit. Waiving loans will have a cascading effect with demands pouring from other States as well. With most States’ financial situation not in the pink of health, they are forced to fall back on the Centre to help tide over the crisis.
HP Murali
Bengaluru
Rejoinder
With reference to the report, “New broadcasting norms set to lower your monthly bill” (June 7) please note : The impact and implications (both long- and short-term) of the TRAI Tariff Order & Interconnection Regulations has not been analysed and discussed in a holistic manner insofar as the industry and the consumers are concerned.
Accordingly, the title of the report is false and misleading and conveys exactly the opposite of the actual consequences that will arise once the Tariff Order and Interconnection regulations come into effect. The said article lacks elementary research as the various aspects of the TRAI Tariff Order and Interconnection Regulations were not even adverted to nor the prevailing dynamics in the pay TV market even addressed.
All the relevant stakeholders in the broadcasting ecosystem were not consulted; instead, a single entity’s views have only been chosen to be articulated and an isolated investor advisory has been relied upon.
K Aravamudhan
VP (Regulatory Affairs), Star India, Gurgaon
Bindu Menon responds: Star’s outrage seems to be prompted by the fact that TRAI has taken a stance not to its liking. The story clearly states Star TV and Vijay TV were opposed to TRAI’s new framework. Star even legally challenged TRAI’s jurisdiction. A final verdict is pending. What is mentioned in the story is a part of TRAI’s new framework. The story indicates a general trend following TRAI’s recommendations. It was not to favour any one side but to say that subscribers may benefit from it. We had reached out to several players including Parul Sharma of Star TV, who was not available.
Editor’s note: We stand by our story. We strongly deny Star TV’s allegations of bias, which are unfounded.
LETTERS TO THE EDITOR Send your letters by email to bleditor@thehindu.co.in or by post to ‘Letters to the Editor’, The Hindu Business Line, Kasturi Buildings, 859-860, Anna Salai, Chennai 600002.
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