Will GST End Kacha Bill system
A very clear picture of financial decisions and actions taken across the nation reveal that all this is to curb black money circulating across the nation. One of the chief sources of arrival of black money in India is Kacha Bill which remains one of the biggest riddles even after upcoming of GST in India. Every individual has the same question: Will the trend of kacha bills come to an end? Well, read on to find an answer to your query.
Where the Prime Minister is satisfied and has taken a sigh of relief, the trading companies are not on board even now. Equally the experts are also in doubt. However, PM stated in the parliament that Kacha bill and pakka bill are responsible mobilizing black money in the country for which GST is coming to put an end to it.
Now, before you actually get into the topic, let’s check out what exactly kacha bill and pakka bill means.
Kacha bill is a temporary bill often issued by a vendor which has records neither in accounts books nor are those revealed for tax purposes.
Pakka bill on the other hand is a proper form of bill which has its transaction record in accounts books and ledgers. In fact, the vendor charges suitable taxes to clients on the invoice which is paid to the government.
Now the question is even after the arrival of GST why will Kacha Bill not leave the marketplace?
First of all the trading community is unthinkingly eager and enthusiastic about GST helping out in tapping this black money source. It has become a general perception across the country that vendors or the shopkeepers do not issue pakka bills. However, this may be true but blaming these vendors alone won’t be fair at all. There is also another side of this picture. There are many customers who do not take interest in taking pakka bills as they will have to pay additional 12.5% tax on the rate of goods which they find hard to pay off. As a result, vendors have to agree on their demands so that the business should not be affected and it gives a rise to the problem this way.
This is the story prevailing anywhere, then how could one think of putting an end to the revolution of kacha bills in the market.
What experts have to say about it?
Preventing this fictious trend of issuing kacha bills is really a tedious job. In fact, it seems to be out of question. Though there are chances that this may get curbed to a great extent as the goods and service tax will already be applied on the goods but still thinking of its elimination soon after the application of GST will be a day dream. The builders, property dealers and many such entrepreneurs accept a major chunk of money for a house in cash while no receipts are given to the customer for that. This way, until the government is not going to act strictly over the issue, black money generation and other such issues will continue to exist.
Arun Jaitley, the financial minister of India agreed that black money revolution continues to revolve in India mainly through kacha bills. He further stated that even computerization is unable to put a full stop on fudging of accounts. This way claiming that Kacha bill system will be curbed completely with the advent of GST won’t be a true statement indeed.
Eventually this compliance structure passing under GST law will curb unfair transactions to a great extent, which means unaccounted transaction won’t be easier to live by in coming times.