Updates from 05th April, 2017
The State bank of India has become the first Indian bank to raise concerns about the compliance required for services under the GST regime. The country’s largest bank feels that there are three major challenges for GST implementation in the services sector; specifically for decentralised services.
First, is the registration process. SBI, and other banks, will need 36 registrations under GST – one for each state they are operating in.
Second, the number of returns filed by the bank will also increase since each registered branch (in each state) will have to file returns separately. This will increase compliance costs as new software will have to be purchased and employees will have to be trained to use it.
Third, banks need clarity on tax rules such as exemptions on derivatives, securitisation etc. SBI Chairperson Arundhati Bhattacharya has said that the bank is working closely with the GST Council to find workarounds for the most obvious and complex problems.