Tax on all supplies from small entities
The latest provisions in GST are going to hurt the small entities.In the last draft of CGST which is approved in parliament. Section stand for levy and sub section 9(4) provide for payment of GST by recipient. Every registered buyer making any purchase from an unregistered buyer will have to pay GST on reverse charge basis.
This is going to hurt those small entities who are not required to take registration.
Burden on registered person for purchase from small entities:
As per the new provisions registered person will be liable to pay for purchase from unregistered buyer. This will create a liability on registered buyer to determine the tax rate and make payment. These purchases can be of any amount. Let say an accountant purchase some stationary or snacks for office then first he will be required to calculate the tax. Many business entities make so many small buying for day to day office expanses. All those expanses will fall under this reverse charge. It will make them purchase from registered person only and small vendors will lose the business.
