Back in Meerut, Pankaj Jain worries that hiring an accountant and charging 5 percent GST on his bedsheets could eat up to two-thirds of his annual profits of 400,000-500,000 rupees (,210-,760).The government will, however, allow firms to file simplified returns for July and August.4 percent to economic growth.To drive home the point, Bollywood superstar Amitabh Bachchan has appeared in a promotional video in which he weaves a cats cradle between the fingers of his hands - symbolising Indias thicket of old taxes."We will China Fluorocarbon O ring Supplier have to hire an accountant - and get a computer," the thickset 52-year-old told Reuters, as a dozen ancient power looms clattered away in the ramshackle workshop next door."Rubber goods are taxed at 12 percent; sporting goods at 18 percent..Prime Minister Narendra Modis government says that by replacing several federal and state taxes, the new Goods and Services Tax (GST) will make life simpler for business.

That spells bad news for small firms hesitating to shift into the formal economy. This allows a company to claim refunds on its inputs and means it should only pay tax on the value it adds.The note ban caused severe disruption to Indias cash-driven economy and slammed the brakes on growth, which slowed to a two-year low in the quarter to March.The official schedule of GST rates runs to 213 pages and has undergone repeated last-minute changes.New Delhi: Businessman Pankaj Jain is so worried about the impending launch of a new sales tax in India that he is thinking of shutting down his tiny textile factory for a month to give himself time to adjust."I know my غير مجاز مي باشدts will go up, but I dont know about my income," he said. The government estimates smaller companies account for 45 percent of manufacturing and employ more than 117 million people.A big concern is the Indian GSTs sheer complexity - with rates of 5, 12, 18 and 28 percent, and myriad exceptions, it contrasts with simpler, flatter and broader sales taxes in other countries. I make rubber sporting goods – so what tax am I supposed to pay?" asks Anurag Agarwal, the local IIA secretary.The structure will encourage companies to buy from suppliers that are GST-compliant, so that tax credits can flow down a supply chain.One particular concern is how a new feature of the GST, the input tax credit, will work. Turning to open a metal cabinet, he pulled out a hand-written ledger to show how he keeps his books."

It is a technological marvel, as well as a fiscal marvel," Revenue Secretary Hasmukh Adhia told Reuters in an interview. "I might even have to shut up shop completely and go into trading".But he is simply not ready for a regime that from July 1 will for the first time tax the bed linen his 10 workers make, and require him to file his taxes every month online.Adhia played down the risk of job losses, however, saying this would be offset by new service sector jobs. From September they must file a total of 37 online returns annually - three each month and one at the years end - for each state they operate in."It could throw the business out of gear - it can affect your volumes by at least 30 percent," said the head of one large cement company in the Delhi region.0The prospect of disruption is drawing comparisons with Modis decision last November to scrap high-value bank notes that made up 86 percent of the cash in circulation, in a bid to purge illicit "black money" from the system.GRACE PERIOD?The top government official responsible for coordinating the GST rollout rebuts complaints from bosses that the tax is too complex, adding that the IT back-end that will drive it - crunching up to 5 billion invoices a month - is robust."In the initial months, there may be utter confusion," said chairman Ashok Malhotra, who runs one firm that manufactures voltage stabilisers and a second that makes timing equipment for boxing contests.On the desk in his tiny office in Meerut, two hours drive northeast of New Delhi, lay two calculators.DEMONETISATION 2.With a flourish, the tangle is gone and Bachchan proclaims: "One nation, one tax, one market!"NOT SO SIMPLEBy tearing down barriers between Indias 29 states, the GST should deliver efficiency gains to larger businesses.3 billion people into a common market.Yet at the local chapter of the Indian Industries Association, which groups 6,500 smaller enterprises nationwide, the talk is about how to cope in the aftermath of the GST rollout. HSBC estimates the reform could add 0.Jain is one of the millions of small business owners who face wrenching change from Indias biggest tax reform since independence that will unify the countrys trillion economy and 1.