Existing exemptions
Industries availing area-based exemption or product-based exemption must start dialogue with the respective government (s) immediately and ensure their benefits are incorporated into the new enactment.
Existing long-term contracts
> All Acts envisage levy of taxes as per the provisions prevailing at the time of event.
> The contracts, which have been entered before the appointed day and to be partly/wholly executed after that day, might relate to-
(i) Works contract activities,
(ii) Leasing activities etc.
> In case of "exclusive of tax" contracts, the contractor must ascertain that he should be in a position (contractually) to transfer the additional burden of tax, in any, upon the contracted. If there is no such clause in the contract, suitable amendment must be carried out before the appointed day.
> All the existing contract, which have been executed "inclusive of all taxes" must be renegotiated to safeguard their interest.
> Where the contractors (with turnover of more than INR 50 lakhs) are paying tax under the compositing scheme, they must evaluate the impact since there might not be such scheme under the GST.
> It should also be ensured that invoice for the work done are raised before the appointed day. For this purpose, it is necessary, that provisions in respect of " time of supply" are properly understood.
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