APSA has urged the AP govt to spare the agencies from GST

Association of Private Security Agencies (APSA) has urged the AP government to spare the agencies from GST.

President of APSA and chairman of Central Association of Private Security Industry (CAPSI) AP Chapter C Bhaskar Reddy along with a delegation of Private Security Professionals participated in a protest march in response to a nationwide call here on Wednesday. He said that about 22,000 security agencies are operating in the country with a manpower deployment of more than 70 lakh security guards.

“Private Security Industry is providing jobs to over 8 million people across the length and breadth of the country and Andhra Pradesh alone has about 1,500 agencies operating with a guard force of more than 3 lakh. APSA is a professional body which is steering the growth of this Industry while ensuring that the interests of all stakeholders are taken care of. Most of the players in this industry are retired personnel from the armed forces or paramilitary forces. Also, most of the security guards are semi-literate and poor from a rural background,” he pointed out.

Bhaskar Reddy said that the security services industry essentially recruits, trains and then provides this trained manpower to its clients. Manpower and other statutory costs constitute nearly 90 per cent of its billing and the operating margins only range from 5-10 per cent. The TDS at 2 per cent of the billing further erodes these margins. The low margins, coupled with delays in receiving payments, was creating a huge amount of pressure on the cash flow of the industry and most of the players are finding it difficult to pay wages on time and/or meet the requirements of depositing statutory dues like PF, ESI and GST.

“One problem which is nearly strangulating the industry is the method of depositing GST. We request that the private security industry which is manned mostly by ex-servicemen and is providing employment to over 8 million semi-literate youth mostly from rural India be accorded the much needed relief from the severe, cash flow crunch that it is experiencing because it is being asked to deposit GST on billing,” he said.

“One way out could be to put the private security service industry in the reverse charge mechanism category wherein the GST would be deposited by the service receiver. The other could be that like TDS, the Service Receiver deducts the GST amount from the bill raised and deposit it with the government,” he suggested. “The issue needs to be examined and resolved on a very urgent basis before it cripples and destroys the private security industry in India,” he stated.