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Ahead of GST Rollout, Shopkeepers Brace for Impact With Little Knowledge

RL Sachdeva, who owns a stationery shop in New Delhi's Laxmi Nagar Market, is anxiously flipping through the pages of a local Hindi daily.

Uday Singh Rana | News18.com

Updated:June 30, 2017, 1:07 PM IST
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Ahead of GST Rollout, Shopkeepers Brace for Impact With Little Knowledge
On the eve of the big Goods and Service Tax rollout, shopkeepers are trying not to panic. (Image: Reuters)
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New Delhi: RL Sachdeva, who owns a stationery shop in New Delhi's Laxmi Nagar Market, is anxiously flipping through the pages of a local Hindi daily. He doesn't know yet what tax slab will paper, which constitutes most of his sale, will fall under. On the eve of the big Goods and Service Tax rollout, he is trying not to panic.

"Pehle koi mujhko yeh bataye, yeh GST hai kya? (First of all, will someone tell me what GST is?)," he says.

Sachdeva says there has been little to no public information on what GST is, what it constitutes and how his business will be affected. All he knows is that his paperwork will increase manifold and the thought makes him irritable.

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"Luckily, I have an accountant working for me. So he can sort this out for me. Otherwise, filing monthly returns will take up all my time."

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But not all have the luxury of hiring accountants. Harvinder Singh, a furniture shop owner, is dejected. GST, he says, will come as a double whammy for him. For two months after the Prime Minister announced that high-value currency notes would be demonetized, his furniture store had remained shut. "I have been running this shop in the market for decades but I have not seen the hardship of this kind. After demonetisation, I didn't have cash to pay my workers. Now, after getting back up on my feet, I have to deal with GST. It would at least help if the government had made us aware of what we need to do. The entire market is functioning on word of mouth. We are all trying to understand this from each other."

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He added, "After spending on workers' wages and raw material, I don't have a lot left. How am I supposed to hire a chartered accountant for Rs 20,000 per month? I will have to save each and every slip of paper because I don't know yet what is needed and what is not. How will we file monthly returns? Maybe things will smooth over soon but all this mass panic could have been avoided. Does this government not plan anything properly?"

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Singh sells furniture, which is a luxury good. He fears a tax hike will permanently damage sales. "Furniture falls under the 28% tax slab. So far, I had been paying 12.5%. If a bed costs Rs. 15,000, post-GST it will be closer to Rs. 20,000. Those who sell groceries will not be hit so badly because people will buy food regardless of price. But who will buy furniture when times are tough?"

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He is not alone in wondering how sales will be affected. Radhe Shyam, a provisional store owner, says, "People will buy milk and bread regardless of the tax, but there are other things that drive up sales. The price of cigarettes and gutkha will skyrocket from tomorrow. My annual turnover is much less that Rs. 20 lakh so I am saved from the paperwork. But what is the point if people can't buy what I'm selling? I wish the government would at least disseminate information."

| Edited by: Puja Menon
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