Shopkeepers call auditors for GST help

Businesses in the city woke up to confusion on Saturday, Day 1 of the Goods and Services Tax (GST) regime.

The telephones of auditors and software developers rang all day, with traders seeking their help to understand a tax system many find bewildering.

Proprietors of shops selling knick-knacks, gifts and hardware are puzzled about the varying slabs for the products on their shelves.

The opticals business is befuddled, too. M A Sharif of Eye Clinic, a spectacles showroom, said, “The rates vary on lenses, sunglasses and glass frames. We paid a tax of 14.5% while buying the products. We now hear the products attract 18% GST.”

He said he couldn’t pass on the GST to his customers as the products already have MRP labels. “We are waiting for the auditor to guide us,” he said.

Abdul Baqi of Steps, a footwear showroom on Commercial Street, was waiting for the computer software to be upgraded with the GST rates.

“We hear GST for our trade is 5%. The major challenge is for the poor cobblers who make and sell their products to us,” he said.

Most are illiterate and don’t know anything about tax, according to Baqi.

“They will be ruined. Eventually, smaller footwear merchants who buy from such cobblers will also be ruined. Only brand showrooms will remain,” said Baqi.

Padmesh Kumar of Just Smile, a gift shop on Commercial Street, said the tax on gift items has gone up from 14.5% to 18%. The tax on greeting cards has more than doubled from 5.5% to 12%.

Electrical appliances and textile shops that get by without handing proper invoices to customers are worried their dealings will now be taxed.

Abdul Hannan of Wow!!, a textile showroom on Commercial Street, said cloth pieces attracted no tax earlier. Under GST, they fall in the 5% slab. The tax on stitched clothes has gone up from 5% to 12%.

“Our margins will shrink as we have to sell old stocks at MRP. We can’t shift the tax liability on to our customers,” Hannan said.

Balachandra N of Maithili Silk, a sari shop at Chickpet, said silk, exempted from tax since the British era, was now in the 5% slab.

“We used to offer 10% concession on the MRP but after GST we will have to charge the full price to retain our profits. We are waiting for the auditor to clarify,” he said.

AC restaurants tax now at 18%
They circulated the bills, officially called invoices, on WhatsApp groups, showing 18% GST being marked as 9% for the state and 9% for the Centre.

Many restaurants not collecting taxes earlier have begun collecting GST.