GST Samvaad: Bridging the Gap Between MSMEs and GST Authorities

The Forum for Internet Retailers, Sellers and Traders (FIRST), an initiative of the India SME Forum (ISF), organized "GST Samvaad" in collaboration with the GST North Delhi Commissionerate on June 21st. This event was designed to facilitate direct communication between MSMEs and GST officials regarding the challenges and burdens faced within the GST framework.

The event witnessed a delightful panel including Mr. Manish Mohan Govil, Principal Commissioner, North Delhi GST, Mr Shaukat Ali Nurvi, Additional Commissioner, North Delhi GST, Mr. Vishal Singh, Deputy Commissioner, North Delhi GST and Ms. Charu Dhankar, Assistant Commissioner, North Delhi GST.

During the event, ISF members articulated a range of ongoing issues. A primary concern was the GST registration process, which many MSMEs across India find excessively troublesome. They emphasized  on multiple registration applications often getting  rejected based on unclear or trivial criteria, creating significant obstacles for small businesses. Another key issue raised was the requirement for Principal Place of Business (PPOB) registrations in every state of operation. This obligation disregards the growing trend of remote and digital operations, necessitating physical offices and incurring substantial working capital and personnel costs. 

Sellers further articulated that the current requirement for multiple GST registrations in various states is an arduous and complex process. This multi-state registration system significantly impedes the growth potential of MSMEs. The participants argued that such regulatory complexity places an undue burden on small and medium enterprises, potentially hindering their ability to expand operations and compete effectively in the national market. FIRST proposed that a streamlined, single-point GST registration system could substantially reduce administrative overhead and facilitate smoother interstate business operations for MSMEs. 

Moreover, FIRST has compiled a list of challenges encountered by MSMEs, accompanied by proposed recommendations for their resolution. This detailed document has been formally submitted to the GST officials for their consideration and action. The intent is to facilitate a structured approach towards mitigating these identified challenges. By providing this consolidated overview, FIRST aims to assist the GST authorities in developing targeted solutions that address the specific needs and concerns of the MSME sector.

Mr. Manish Mohan Govil, Principal Commissioner, Delhi North GST, acknowledged the India SME Forum and FIRST’s efforts in bringing MSME issues to the forefront. He stated, "While immediate solutions may not always be possible, we are committed to listening and relaying these concerns to the relevant authorities. Effective communication in events like these is crucial for addressing the challenges faced by MSMEs." He further outlined plans to launch biometric centers in the coming months to alleviate interstate operational challenges, reaffirming the commitment to fostering an environment conducive to MSME growth and global success.

Mr. Vinod Kumar, Founder Trustee, FIRST and President, India SME Forum, said “The GST framework presents numerous challenges for MSMEs, significantly impacting their efficiency and growth potential. These challenges range from complex registration processes and burdensome compliance requirements to difficulties in claiming input tax credits, all of which pose substantial obstacles to the seamless functioning and expansion of MSMEs across India. This initiative aims to highlight the challenges faced by MSMEs, particularly the complexities of multi-state registrations for new e-commerce business models. We plan to take these issues to stakeholders nationwide and conduct similar dialogues across various states to allow more sellers to voice their concerns.”