New Delhi, May 17 (KNN) Industry bodies Federation of Indian Micro and Small & Medium Enterprises (FISME) and Tamil Nadu Chamber of Commerce have raised concerns over the difficulties faced by online Micro, Small and Medium Enterprises (MSMEs) and sellers in obtaining Goods and Services Tax (GST) registration in Tamil Nadu.

In a webinar held on Thursday, the organisations noted that many MSMEs in the state have encountered hurdles in procuring GST registration due to bureaucratic inefficiencies and stringent, often misinterpreted, requirements from state authorities.

Key challenges cited include excessive scrutiny regarding shared business spaces, mandates for constant workstation presence, and the obligation to justify Tamil Nadu as the primary state of registration.

Tamil Nadu accounts for 8 per cent of India's MSME sector, hosting nearly 5 million enterprises - the third-highest nationally. However, online sellers have voiced apprehensions over license cancellations amid physical presence mandates, pointing to a significant divergence between GST guidelines and their practical implementation, thereby posing obstacles for legitimate businesses.

"Despite diligent efforts to secure GST registration in Tamil Nadu, we have faced repeated rejections, hampering our ability to serve the region effectively. The short notice and inability for physical presence have compounded the issue," remarked Manish Singla, Chief Executive Officer and Founder of Healthy18, an online seller.

Anil Bhardwaj, Secretary General of FISME, acknowledged that while GST was expected to promote transparency and simplicity, challenges persist, particularly for emerging business models like e-commerce. He emphasised the need for clear and concise guidelines, coupled with increased awareness among GST officers.

"Meaningful dialogue between MSME bodies and the GST department is crucial to finding common ground. It's important to note that the solution lies not in tax avoidance but in streamlining processes for easier compliance," Bhardwaj stated.

The industry representatives underscored that simplifying the process would make compliance more manageable for businesses, aligning with India's endeavors to promote the MSME sector.

(KNN Bureau)