Goods and services tax (GST), effective 1 July 2017, is expected to have a profound impact on the way business is done in India. The print industry too is bracing up for the challenges ahead. While a majority of printers in Mumbai and Pune are upbeat about the impact of GST in the medium to long term, some are unsure how the new regime will impact in the short term as a few areas of concern remain.
Sanjay Kadam of Pune’s Kadam Digital says that GST will not be an issue for printers who keep their records clean and who deal in receipts. For printers who have not been following proper procedures, the new system could create problems. “It will bring discipline to the print industry,” Kadam opines. Another positive impact, especially for printers in Maharashtra, that the GST is likely to bring is lowering of final tax rates as Maharashtra has comparatively higher taxes than the other states of India.
However, Kadam says that the fact that different print services have been bracketed in different tax slabs has created confusion among the printers. He suggests that there should be just one slab for all print products.
Mail Order Solution’s Mehul Desai is rather circumspect about the GST and has a ‘wait and watch’ stance. “While GST is a progressive thought and something that the country is looking forward to, the way the policy will turn out will tell us if things become easy or not. Only time will tell if doing business will become easier under the GST,” he says. Just like Kadam, Desai too is critical of the fact that different print products have been placed under different tax slabs. “I would have preferred that everything related to print were kept under the 5% slab. Also, there are some definitions of certain print products that are vague and open to interpretations,” he adds.
Kushru Patel of JAK Printers says that he would have preferred the GST to be in line with what is in force globally. However, he is confident that all the confusion that is among the printers will get sorted out in a couple of months. “We are hassled even when we shift to a new house. It takes a few weeks to settle down. Similarly, even printers will get back to normal in a few months.” His only wish is that whatever rise in revenue that the government gets from GST should be used for improving the infrastructure of the country.
SRK Digital’s Kalpesh Mehta expects very little business to happen at least during the first two months of GST coming into force, especially as small printers would need that much window to fully understand the nature of the new tax system. “Not many business owners have complete clarity about how much credit they will get under the GST. I expect the first few months to be spent in understanding what the new system is all about,” he says. However, Mehta believes that in the long run, a lot of work that was transacted without proper paperwork will come into the formal economy.
Siddharth Wagal, partner, Siddharth Offset & Chandana Graphics says, “The implementation of GST may lead the printing industry to get into a better business model. The major development will be that of single taxation, which is beneficial as 5% octroi will be obsolete. Printers like us will get the necessary boost. Further, we also need to look on how the tax rates will be charged.”
Hemant Rathi, assistant manager, Arihant Digiprint observes that the GST’s implementation will be key to the printing sector as the rate of taxed goods—color, machine, paper—and other components— buying an equipment and spare parts for machines—will have to be addressed differentially. He also said that 18% rate has to be considered looking at whether a printer who is importing machinery has to pay 18% on receiving the final product or the printer will be charged excise duty differently.
