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Mission GST – Reforming the
ecosystem
By Narayan Saraf, CFO - India Business at Cipla Ltd.
The midnight of July 1, 2017 has now
gained monumental significance in
India’s economic history, as the
Government formally ushered in the
Goods & Services Tax (GST) era, with a
special session of the parliament.
On a professional front, it was a
momentous occasion for Team Cipla as
well, who have worked round-the-clock
for the past eight months to meet the
GST deadline. The journey for GST-
compliance began in October last year,
and at the stroke of mid-night hour as
GST came into existence, Cipla was
ready for the new taxation regime and
generated its first GST compliant sales
invoice at IST 02:00 AM.
One fundamental feature of GST is that
tax paid on purchases is available as
Input Credit. The current multi-staged
tax structure had charges from the
State and Central governments
separately, leading to cascading effect
of taxes. There were taxes at different
rates and at multiple points. The Centre
had taxes like Service tax, central sales
tax and excise duty while at the State
level it included VAT or sales tax, octroi,
state excise, entry tax etc. These taxes
were not creditable against each other