Once the pandemic settles down, the GST Council can merge the tax rates from the existing four slabs to three slabs so that the compliance burden is minimised for the taxpayers and ensure that there is no revenue loss to the government, opines Biswarup Basu, president, Institute of Cost Accountants of India. In an interview with Mithun Dasgupta, Basu says in the disruptive post-Covid scenario, cost & management accounting has acquired prime spot to ensure survival, continuity and sustainability of a business. Edited Excerpts:
As Covid has created significant challenges for financial institutions and companies, how has it changed the conventional roles of a cost & management accountant?
In the pandemic period, we developed two very important documents — “Conceptual Approach to Board Reporting Framework — A Post Covid-19 Corporate Governance Perspective” and “Post Covid-19 & Lockdown – Technical Guide on Business Continuity Plan” — that would certainly help in proper board-level monitoring and evaluation and in preparing right business continuity plans post lockdowns. We have also developed activity-based performance costing system that would assist the organisations to correctly and timely measure and assess the performance of different activities/ operations.
GST collections in July crossed Rs 1-lakh-crore mark after the easing of Covid-curbs. Do you expect this to continue going ahead?
Yes, the relaxation of the restrictions has helped the industry come back to normalcy to a large extent in increasing the GST revenues for July 2021. Apart from these, the digitisation initiatives in the GST have also contributed a lot. I believe GST collections growth will continue as the ITC control measures are now in place i.e by way of matching with GSTR-2a data. However, system control by way of GSTR2 will further strengthen the system and avoid revenue leakage.
What are your views on the current GST rate structure? What have been the implications of the current regime in today’s cost & management accountant functioning?
The current average rate of GST is a notch above 11%, which is very less than what it has been envisaged. Any further reduction will impact the collections and have an adverse impact on the central and state government spending, which will impact the growth. Once the pandemic settles down, the GST Council can merge the tax rates from the existing four slabs to three slabs so that the compliance burden is minimised for the taxpayers and at the same time ensure that there is no revenue loss to the government.