Navigating GST Challenges as a Small Vendor

As a small vendor with a composite GST system, I've encountered unexpected hurdles in the GST regime. With a monthly sales turnover of less than ₹20 lakhs, I pay 1% tax on my sales quarterly. However, the benefits of GST seem elusive due to certain challenges.

The Logistics Conundrum

The recent GST changes have led to increased logistics charges, which have significantly impacted my business. To transport my produce from Nanjangud to Bengaluru, the logistics company requires a GST purchase bill. If I produce this bill, the logistics charge would be around ₹5.30 per kg, similar to pre-GST rates. However, if I don't have a purchase bill, the logistics company charges ₹7.30 per kg, even if I provide proof of land ownership and a letter from the landowner.

The Purchase Bill Dilemma

The issue is that most farmers I procure from don't have purchase bills, making it challenging for me to transport their produce. This has created a logistical nightmare, and I'm not sure how to resolve it.

Impact on Consumer Delivery

Consumer delivery through porters has also become more expensive, with an additional GST charge of around 15%. This increase will likely be passed on to customers, making my products less competitive.

Mixed Impact

For products I procure from non-GST compliant farmers, prices have increased due to logistics charges. On the other hand, vendors with GST have reduced their prices due to GST rate cuts, making their products more competitive. Although logistics charges have increased slightly, the reduction in GST rates has more than offset this increase.

The Way Forward

As a small vendor, I hope the government will consider the challenges faced by farmers and small businesses like mine. A more streamlined GST system and clearer guidelines on logistics and purchase bills would greatly benefit us.

Key Takeaways

-Logistics companies require GST purchase bills, which is a challenge for small vendors like me.

- Increased logistics charges are eating into my profit margins.

- GST rate cuts have benefited vendors with GST, but non-compliant farmers are struggling. They will end up giving their produce to brokers at cheap rate.

- I hope for clearer guidelines and a more vendor-friendly GST system.

By sharing my experience, I hope to highlight the challenges faced by small vendors like me and the need for a more practical and supportive GST system.