Composite GST framework raises input credit reconciliation and dual jurisdiction implementation challenges for tax administration.
Introduction of a Composite Goods and Services Tax aims to remove cascading, broaden the tax base and simplify compliance, but the discussion paper leaves unresolved key mechanics of input tax credit set-off between central and state components and the treatment of inter-state credits. It also omits operational details on rates, service thresholds, timelines for legislation and constitutional amendment, and lacks a clear mechanism to secure state consensus, creating implementation and coordination risks under concurrent centre-state jurisdictions. (AI Summary)