Below the Line: GST blues

Our Bureaus | Updated on January 13, 2018 Published on February 26, 2017

“Hear us out Mr Prime Minister Sir”, is how a letter from Indian Revenue Service Association dated February 21 seems to plead. As the proposed rollout date of GST approaches, IRS officers are a worried lot. They have pointed out that while they are committed to successfully rolling it out, in many countries GST implementation has failed because of faulty execution in the hand of generalists.

“…The Officers of our service have made significant contribution to the GST process and continue to do the same. Our officers have tirelessly been working on GST for last 10 years and wish to nurture it, having got requisite expertise. They are aware of the intricacies of indirect tax functions and have experience of General Administration, Tax administration, Adjudication, Investigation with required technical expertise etc.”

“However, the decision January 16, 2017, has caused serious concerns (of) it being detrimental to the Centre. The decision seems to be one-sided in favour of States weakening Sovereign function of Centre regarding levy and collection of taxes. Our apprehension is that GST in this form may not bring the desired goals of better Tax compliance, more revenues, ease of business and reduction in inflation and an instant spurt in Economic Growth.”

But then, who is disputing the merits? Surely not the finance ministry.

Stop this witch-hunt

Insiders claim that the chief executives of top state-owned banks recently told Finance Minister Arun Jaitley that government agencies such as the CBI and the CVC should stop the witch-hunt of bankers. They said their general managers were reluctant to sign for new credit approvals for fear government sleuths would get after them after a few years. Credit growth (a measly 4 per cent in 2015-16) cannot improve in this climate, they are believed to have said. Well, the the Government is hardly likely to oblige; after all, if bankers are absolved of CBI/CVC scrutiny, then the IAS lobby would want a similar dispensation for its officers. Now, that’s a tall order.

Suitable boys

Consolidation’s the buzzword these days, be it the telecom sector or the banking sector, especially after demonetisation. So far in the financial sector, we have seen consolidation only within the SBI group. However, finance ministry corridors are full of more consolidation-related talk — this time finding suitors for struggling PSBs. So don’t be surprised if a bigger south-based bank is nudged to acquire a weak PSB in another region. Industry watchers says consolidation action is definitely likely on the private sector banks front. The only area where consolidation does not seem to happen is on the political front — there’s a new political outfit getting floated every other day!

It’s a fine world

Last week, Geoffrey Van Orden, member of the European parliament and Chair of the European Parliament delegation for ties with India, led a team to India to revive talks for an India-EU Free Trade Agreement and Bilateral Investment Treaty (BIT). During his address to journalists he said, “UK is planning to leave Europe, we are seeing an adventurous Russia, a muscular China, terrorism is there, rest is fine.”

Partiality rules

When Snapdeal let go hundreds of employees after giving them three-months’ salary claiming that their company was passing through a turbulent phase, there was a whimper of protest either from the trade unions or the labour ministry. Eight years ago, a bleeding Jet Airways sacked nearly 2,000 employees, most of whom were on contract or probation.

All of them were hired back within days after the Government, politicians and local unions forced them to do so. Looks like startups can do no wrong.

Published on February 26, 2017

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