This post was originally published on The Economic Times
New Delhi: The inverted duty structure resulting from rate changes under the Goods and Services Tax (GST) 2.0 regime is hurting companies especially in the FMCG and over-the-counter (OTC) pharma sectors, with high input-side taxation on key services leading to accumulation of credits, Khaitan & Co Indirect Tax Partner, Sudipta Bhattacharjee told on Friday.
“The whole issue of inverted duty structure emerging after GST 2.0 has started hurting a lot of companies in the FMCG or over-the-counter drugs business,” Bhattacharjee said.
Citing the reason for the same, he said this is mainly “because for them there is a massive expense on the input side for services like which marketing and advertising services on which there is 18 per cent GST which is getting accumulated because you don’t get an inverted duty refund for those input side services.”
He added that the issue is one of the key concerns flagged to the government, with expectations that authorities may “do something to mitigate this problem.”
Highlighting another major concern, Bhattacharjee pointed to the removal of GST compensation cess
— Read the rest of this post, which was originally published on The Economic Times.
