Being non-compliant on GST – Much beyond penalties & interest on them!
GST is Live in India. As mentioned in the earlier posting on this topic, large corporates and their immediate suppliers would have become GST compliant on time. So would have those SMEs that used SAP Business One since SAP provided the required updates well in time and partners like Praxis have program managed the GST migration initiative effectively. Many from the remaining lot of SMEs are likely to be in a catch up mode still. How long can then remain laggards? Not much. In fact, they need to get their act together really quickly else they stand to lose much more than the penalties for noncompliance – which include late fees, interest and even arrest in case of tax evasion. Here is how:
If the supplier is registered (GSTN) company its performance with respect to filing returns on time, accuracy etc. will be monitored by the software. In fact, each registered company will awarded a star rating (or equivalent) on GSTN portal. This rating is not to be taken lightly for the simple reason that customers will be including this as a part of vendor evaluation in coming times.
Well, how does it impact the suppliers and their business? This is how. If suppliers do not file accurate returns on time on a consistent basis their customers will be facing a financial loss since they will be unable to take input tax credit (ITC) on their inward supplies. In return, their cash flow (& indirectly their working capital) gets affected negatively.
It is quite natural to assume that no customer would like to continue working with such suppliers that cause them financial losses. Hence, it is very likely that they will develop another source for the supplies (goods or services) and drop the defaulting ones at their earliest possible convenience. It quite evident, hence, that non-compliance on GST front can actually lead to loss of business – which is much severe blow as compared to paying fines for delays in filing returns.
SAP Business One solution will not only help companies become GST compliant in a very short time but has several more benefits to offer to SMEs. It makes lot of business sense for SMEs to consider implementing SAP Business One if they want to grow their company in a transparent manner riding on the positive wave of the one nation one tax (GST)!
Praxis has partnered with many companies from the different industry to become GST compliant using SAP Business One. To learn about the same, please contact us at sales@praxisinfosolutions.com