There are around seven crore small and medium traders in the country, which in turn provide employment to nearly 45 crore people by generating an annual business worth Rs 42 lakh crore jethabhai, a kirana merchant who deals in pulses, spices and dry fruits at the Dana Bazar located in the APMC market in Vashi, Mumbai, isn’t too happy these days. His business has been dull, with the general slowdown of consumption and steep competition from large online and offline retailers weaning way his customers. "We used to do Rs 2 lakh business on a daily basis, we are not even doing Rs 50,000 these days," said Jethabhai. Jethabhai, who has been in the wholesale and retail business at APMC for more than three decades, said the there has been a discernible change in the last three years.

"There is no demand, the big malls are pulling away our customers," lamented Jethabhai. Adding to that was the introduction of the Goods and Services Tax (GST) and the government's push towards digital transactions, which have increased the burden of small traders who largely transact in cash and find filing taxes complicated. "We don't have any problem with GST, but we expect government to make it simpler to file," said Jethabhai.

The use of swiping machines and digital wallets have spiked in the aftermath of demonetisation. Now cash has once again come back to rule the roost. "I am not comfortable at using cards and electronic payment systems, for us, cash is easier," Jethabhai said. It’s not Jethabhai alone, other traders at the APMC tell similar tales. Spread across 300 hectares, the APMC is one of the largest in Asia, with separate wholesale markets for fruits, vegetables, food grains, pulses, onion and potato, sugar and spices. It’s a bustling market where farmers sell their produce, with wholesalers and retailers their customers. But the general economic slowdown, GST and competition from large multi-chain retailers have put the brakes on traders' profits at the market. Girish, a trader of fast moving consumer goods (FMCG), at the Dana Bazar, said that he needs a tax expert and an accountant for the book keeping and maintaining consistency while filing the returns on a monthly basis. “Tax filing through GST isn't easy, we have to keep a person for that purpose. It had increased our costs, while our business hasn’t seen any improvement,” Girish said.

Girish said his business has dropped 20 percent. “When GST was introduced the traders were not ready, most of them never used computers. There were glitches in the GST portal, confusion over classification of goods and their tax slabs, refunds were not coming and return forms were complicated,” said a trader of rice and wheat, who didn’t want to be named. “Now things have improved, but we want even simpler tax filing and want to see GST consolidation under three slabs of zero percent, five percent, and 16 percent," he said. The government did try to make life easy for small traders and businessmen, who have been a major support base of the BJP — the majority party of the ruling NDA government.

There are around seven crore small and medium traders in the country, which in turn provide employment to nearly 45 crore people by generating an annual business worth Rs 42 lakh crore. But the community feels that they were neglected, adding to the witch-hunt by tax authorities. Realizing this, the government this year doubled the exemption for small traders from Rs 20 lakh to Rs 40 lakh annual turnover. To reduce the compliance burden, the government extended the eligibility for the Composition Scheme for business having an annual turnover of Rs 1.5 crore from April 1, 2019. Traders registered under the Composition Scheme would be allowed to file annual returns and pay taxes on a quarterly basis. But the traders expect the government to do more.

The Confederation of All India Traders (CAIT), the body that represents traders, has sought for a simplification in the filing of GST returns. Aside from implementing the promise made by the BJP in its manifesto about providing Rs 50 lakh loan without any collateral, CAIT also sought for Finance Minister Nirmala Sitharaman to increase income tax exemption limit from Rs 2.5 lakh to anywhere between Rs 5 lakh to 7 lakh, as the consumer price index has gone up over the last many years. The traders are also demanding that the government stop allowing foreign direct investment into retail trade and e-commerce as it is eating into their business. Till then, traders like Girish and Jethabhai are biding their time to see what the budget has to offer.

Source:moneycontrol