The conference on 'Implications of GST on Infrastructure & Construction Sector' organised by the PHD Chamber of Commerce & Industry in New Delhi, was an exercise in intellectual stimulation as industry experts sought to unravel the components and complexities within the proposed new tax and its impact on businesses

By Seema Gupta


GST Conference

Roads, Ports & Other Infrastructure Committee and the Indirect Taxes Committee of PHD Chamber of Commerce & Industry organised a conference on 'Implications of GST on Infrastructure & Construction Sector' on 1 December 2016 at PHD House, New Delhi. More than 60 delegates and 14 speakers from the Construction Industry and other stakeholders attended the full-day event.

The objective of the conference was to analyse the provisions of the model GST law and assess its impact on the infrastructure & construction sector. The conference provided an opportunity to get insights from a distinguished panel of leading GST experts, tax advisors and practitioners. Delegates included senior officials from the central and state governments, industrialists, policy makers, thought leaders, and financial institutions, among others.

Mr. Ashish Mohan Wig, Chairman, Roads, Ports & Other Infrastructure Committee, PHD Chamber, in his welcome address said that the new tax regime will have an impact on all the sectors including infrastructure. Currently, infrastructure projects enjoy various concessions and benefits from indirect tax perspective, and it is imperative to evaluate whether these benefits would continue under the GST regime.

He said that in order to clear the uncertainties regarding GST, it would be necessary to organise a series of such sessions in different states as they are not in sync. "We will go to them, compile their suggestions and take it to the government for implementation. Infrastructure is the most important sector and every vertical within it gets impacted differently by GST. We want to deliberate on different aspects, get feedback from all, and assimilate the information and expert views from all concerned."

Mr. Bimal Jain, Chairman, Indirect Taxes Committee, PHD Chamber, in his theme presentation, highlighted that the Chamber has been interacting with various functionaries of the Finance Ministry on the issue of GST, and has emphasized the need that post GST, the key segment of infrastructure sectors should continue to enjoy the existing tax exemptions including input credit to retain the vibrancy of the sector for its further growth and multiplications. He also said that the Chamber has advised the government to bring in the model of GST law, devoid of and free from tax cascading effect to improve ease of doing business. The government is committed to enabling ease of doing business for larger economic engagements from both overseas and domestic investors.

Mr. Anil Khaitan, Sr. Vice President, PHD Chamber, in his special address mentioned that the trust deficit that has grown up between the government and industry should be narrowed down for the growth of the country and the coming generations. Referring to the housing for all by 2022 scheme, he raised doubts as to how would this address GST as the scheme is for the poor people.

Mr. Anil Sood, Founder, CAS Associates, said that the GST code should be such that it can not lead to double taxation, and also facilitate placement of healthy business practices for comfort of both the government and industry. According to him, 90% contracts end up in arbitration because of tax liabilities. There are various issues such as multi-state contracts (supply of materials/services), offshore supply (only custom duty is being paid now), petroleum is outside GST so how will this impact the aviation industry? Will cost of air travel go up? All these issues need serious deliberations and will have to be taken up with the government.

Speakers gave an overview of the GST, update on change in Model GST law draft, provisions of GST and the implications thereon and an analysis. During the two technical sessions, they shared their views on topics such as GST applicability on works, contract and construction; applicability on ports and infrastructure; exemptions under present tax regime and proposed GST; transition provisions; impact on procurement of goods and services (domestic and offshore); concept of supply and valuation under GST; vendor negotiation; tax planning opportunities under GST, and so on.

Delegates and speakers raised relevant, practical issues and concerns regarding sustaining businesses post GST, which they feared would raise tax rates from the current 15% to 18%, which would impact consumer spend. The idea behind GST was to do away with multiple taxes, and the maximum impact and of administration was being felt by the Construction and Real Estate industries. While earlier, only the positives of GST were announced, but now it appears that from a single taxation there could be more components within it, besides which, there was no clarity on the multiple slab rates, classifications, etc, all of which could increase litigation.

It was felt that taxation was set to become higher than in the present taxation scenario. Rules were yet to be framed, assessees were still not prepared, systems would have to be adjusted accordingly, need for analysis on various projects, advance planning for critical precautions, and transitional issues with ongoing projects. Concerns were raised on procurement of goods & services, supply and valuation, project cash flows, impact on suppliers & EPC contractors, flow of credits, implications on inter-state works contract, cost of compliance, and element of tax on tax.

There were too many riders, as there were the pros and cons. So why was the industry going through this exercise as the complex issues were not enabling 'ease of doing business' as being propounded by the government? The question raised but left unanswered was "Is GST the desired tax reform?" Mr. Vijay Chaudhry, Director, PHD Chamber, delivering the formal vote of thanks, called upon the delegates present to give their inputs, feedback and suggestions, which the GST Council would take up with the government.
Click Here
To Know More or to Contact the Manufacturer
Please let us know your name.
Invalid Input
Please let us know your Designation.
Please let us know your Contact Number.
Please let us know your email address.
Please brief your query.
Our other Value-Added Services:

To receive updates through e-mail on Products, New Technologies & Equipment, please select the Product Category(s) you are interested in and click 'Submit'. This will help you save time plus you will get the best price quotations from many manufacturers, which you can then evaluate and negotiate.

Invalid Input
Invalid Input
Invalid Input
As humanity reeled under the onslaught of Covid-19 and the resultant uncertainty, the world applauded the millions of essential services workers who toiled tirelessly at great risk to their personal health

Read more ...

Despite the pandemic, Changsha International Construction Equipment Exhibition (CICEE 2021) became a huge success with 1,450 exhibitors showcasing their products and technologies on an exhibit area

Read more ...

In an online event, GHH India along with its mining contracting subsidiary, GHH Bumi Mining Service, was awarded ‘Best Performing Business Partner’ by Vedanta Group/Hindustan Zinc Ltd (HZL)

Read more ...

In order to fully implement General Secretary Xi Jinping’s instruction on "building Hunan into a nationally advanced, important highland of manufacturing industry" during his inspection of the Hunan province

Read more ...

Over the years, the IEE Expo has positioned itself strongly as a networking and sourcing platform for elevator and escalator industry professionals, and where buyers can witness the latest technologies and conveniences

Read more ...

Government of India’s ambitious ₹111 lakh crore National Infrastructure Pipeline (NIP), which has already been announced and actioned upon, augurs very well for enabling sectors such as the Indian Construction Equipment

Read more ...

bauma CONEXPO INDIA - north India’s leading International Trade Fair for Construction Machinery, Building Material Machines, Mining Machines and Construction Vehicles - has been rescheduled from 3-6 November 2020

Read more ...

INTRALOGISTICA ITALIA is the only exhibition with a comprehensive offer dedicated to the most innovative solutions and integrated systems for industrial handling, warehouse management, materials storage and picking

Read more ...

The Indian Concrete Institute, Goa Centre, in association with Ultratech Cement Limited organized the 9th ICI-Ultratech Awards Nite on 19th February 2020 at Hotel Fidalgo, Panjim Goa. The annual event was attended by nearly 250 invitees

Read more ...

The Indian Concrete Institute in association with Dayananda Sagar College of Engineering organized a one-day seminar on Geopolymer Concrete Applications: Challenges and Opportunities. In this fast-developing world, it has become

Read more ...

Conexpo 2020 was held as scheduled on March 10, 2020 in Las Vegas, USA. Established Chinese construction equipment enterprises like XCMG, Zoomlion, Sany, LiuGong, Shantui, Sunward, and many more once again demonstrated the strength

Read more ...

Multiple construction and construction materials industry segments unveiled new technologies and products, shared knowledge, networked with industry peers and bought equipment at the CONEXPO-CON/AGG & IFPE 2020, held at the Las Vegas

Read more ...

In line with its strategy to enhance customer experience with minimal downtime of elevators & escalators, and for swift deliveries of spares, KONE has opened a new warehouse at Andheri in Mumbai that houses more than 2000

Read more ...

The 45th edition of World of Concrete for the concrete & masonry industries drew about 54,000 registered professionals to the Las Vegas Convention Center and featured 1,310 companies (including 255 brand new companies) exhibiting

Read more ...

Once a year, the specialist group meets in January to discuss operational issues and projects for the current year. In economic terms, the industry is still at the record level of 2018, and its sales in 2019 will match the previous

Read more ...

Mahendra Singhi (Managing Director & CEO – Dalmia Cement (Bharat) Limited) and Nilesh Narwekar (CEO – JSW Cement) have been elected as the Chair and Co-chair, respectively, of the GCCA India to provide strategic direction

Read more ...

The 2nd Edition of iCEMA Conclave organized by Indian Construction Equipment Manufacturers Association, deliberated on new avenues of construction equipment financing, challenges and measures. NBM&CW reports.

Read more ...

The Indian Concrete Institute, Goa Centre, organized a One Day Workshop on “Recent Advances in Waterproofing Technologies” on 16th January 2020 at Metropole Hall, Hotel Nanutel, Margao Goa, under the aegis of Indian Concrete Institute

Read more ...

At Greenbuild India hundreds of green building and sustainability professionals discussed LEED and green building practices that help deliver a more sustainable future. The U.S. Green Building Council (USGBC) held the third

Read more ...

The Construction Chemicals Manufacturers Association (CCMA) hosted the 7th edition of International Construction Chemicals Conference at Hotel Taj Lands End in Mumbai. The theme was “Role of construction chemicals in infrastructure

Read more ...

×
Sign-up for Free Subscription
'India Construction Week'
Weekly e-Newsletter on Construction Industry
Get the latest news, product launches, projects announced / awarded, government policies, investments, and expert views.