An idea worth considering is to give individual income tax payers a tax deduction of, say, up to Rs 2 lakh per annum against the GST paid by them on all purchases over a limit of, say, Rs 1,000. This will create a powerful incentive for consumers to move away from the cash economy, and act as a reward those who pay taxes regularly and stick to the “white economy”. All that the vendor needs to do is to capture the PAN number while making a sale and upload it on the GST portal at the time of the payment. All that the tax payer needs to do then is to download an end-of-year statement (like from Traces) and incorporate it into the IT returns annually.

This will have a significant impact on compliance, as the retail consumer will tell the final vendor to include his name and PAN number in the invoice while paying GST.

Unfortunately, retail consumers do not have a body of people equivalent to the “industry body” to advocate their concerns. Maybe social media can bridge this gap.

PS Views expressed above are strictly personal.

This piece was first published on LinkedIn and has been republished here with permission.

Also Read:

A Simpler, More Stable Way To Set And Reset The GST Rate

Explained: Why India Needs The GST

retail-consumers

Get Swarajya in your inbox.