Cooperative Banks Prepare For GST
With the new tax reform in place, representatives from cooperative banks discuss the steps to adapt to GST
Photo Credit : Bloomberg,
Goods and services tax (GST) has been the topic of discussion for all industries including the banking sector. Cooperative banks discuss the rules regulations and norms to follow the procedure and the impact of the new tax reform in the rural areas of India.
Sanjay Rane, CA & Auditor said, "GST is replacing all taxes with one tax and the difference is the supply concept of goods and services that has come into existence. Banks were earlier charging service tax and receiving input credit. Now banks charge GST on services provided and charge input credit. There are two types of services known as Input and Output where the Output service is similar to the service tax regime."
"Since banks can avail capital on goods and services they will have additional credit which they can pass on to customers. There are a lot of other services on which banks have to pay GST on reverse charge mechanism," says Vikrant Ponkshe, Chairman & MD, Being Catalyst Pvt Ltd on the outlook for the banking sector.
Shridhar Rane, Head IT, SVC Co-operative Bank Ltd talks about the infrastructure, people, connectivity and applications for calculation with respect to the preparation Cooperative banks need to do under GST.
"People, connectivity and application for calculation are three main factors we need to consider under the new tax reform. Vendors who address to core banking are not aware of the system and the peripheral application behind it. Any services I use will require me to submit an invoice. Hence to address the complications behind loans and free services we need to bring up the Information & Technology sector which is a challenge at the moment."
Sanjay Rane further states that the preparation is not really good and that to make the country GST ready there should be awareness of the norms rules and regulations of the tax reform.
The panel was moderated by Hemlatha Saptarshi, IRIS Business Services Ltd at the 2017 BW Businessworld Cooperative Conclave. Following the panel discussion was the felicitation ceremony where the unsung heroes of the cooperative industry were awarded for their contributions.
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