Get the small details right: Robert Tsang

He says GST compliance framework is very much of the 21st century, big, bold, next-generation

Robert Tsang, GST Implementation Leader & partner, Deloitte Singapore, has an extensive experience on various aspects of GST implementation in Singapore and Malaysia. He recently relocated to Mumbai to help Indian business get GST-ready. In an interaction, Tsang tells Sudipto Dey why under GST it is important to keep anti-profit rules simple. Edited excerpts:

From a compliance perspective, how would you assess the Indian GST regime compared to other jurisdictions?

The Indian GST compliance framework is very much of the 21st century — big, bold, next-generation. It gets to the heart of a transaction tax by requiring transaction-level accounting. There is an enormous focus on technology-enabled tools — the framework for filings, registers and returns defined on the basis of transaction-level details. The Indian GST compared to other jurisdictions is fundamentally simpler, but much more demanding of taxpayers, particularly given the short timeline to implementation.

Are there any lessons for India from Malaysia’s experience of administering the anti-profiteering rules?

The adage of “keeping it simple, sir” is the most important lesson from Malaysia’s experience of anti-profiteering rules. You only need to look at the rules that were initially applicable from 2015 in Malaysia to the slimmed-down, focused and targeted rules that Malaysia uses today to drive out profiteering behaviour. Simple rules mean better understanding across business and industry — which can only help make the GST work for everyone.

What are the key implementation challenges typical of India?

Our clients tell us that time is the biggest constraint and challenge to GST implementation in India. Infrastructure and IT changes take much longer than anybody really assumes to execute, for even seemingly simple things like creating valid GST invoices. The clarity on the application of the rate slabs and the fitment exercises is gradually emerging. Many businesses worry that at this stage much is being made of the need to be fair and reasonable in pricing, but there is no yet clear guidance on the anti-profiteering rules laid out in the Central GST Law.

With less than 30 days to go, what is your assessment of Indian industry’s readiness for the GST by July 1?

You cannot generalise on readiness for the GST — everyone is different. However, Indian business and industry have an excellent track record on being ready when the bell rings and the gates open. Most enterprises seem to be focused on the nitty-gritty of compliance requirements after implementation — driving execution of the critical operational imperatives rather than trying to do everything. Prioritising key elements of the implementation strategy now is paramount — in the GST if you get the small details right, the bigger things have a way of taking care of themselves.

So, what is the one or two things businesses must get right to be effective under the new regime?

Getting a good process in place in the GST for dealing with exceptions and mismatches in basic invoicing and compliance is key. That is what unlocks credits, and ensures that small issues are dealt with and that the business is able to move on. The new GST brings with it a new paradigm for building good relationships with both the Centre and state level (tax) authorities — time spent in making sure that the authorities understand what the businesses are doing, its approach to GST accounting is time well spent. Communicate with the authorities — good, effective communication is really important in the brave new world of the GST.