According to the SoP that was released on 26th May, 2023, returns selection for scrutiny will be taken care of by the General of Analytics and Risk Management (DGARM) depending on the various risk parameters that are identified by them. The Central Board of Indirect Taxes and Customs (CBIC) stated that the unit of analytics will identify the returns for scrutiny. DGARM will pick the GSTINs that are registered with the central tax authorities and the GSTINs details selected will be available on the scrutiny dashboard of the respective Central Tax officer on the application of ACES-GST.
- May 29, 2023
The Goods and Service Tax department has provided taxpayers with an option to submit the reconciliation statements(GSTR-9C) and final annual returns(GSTR-9). The deadline for submission is announced to be 31st December 2023.
All registered taxpayers must submit these documents. These documents constitute information about paid taxes, supplier details, and ITC claims for the fiscal year and should be prepared by a qualified chartered or cost accountant.
The reconciliation statement is for those taxpayers whose annual turnover crosses the threshold limit. The taxpayer must compulsorily hold a GSTIN and submit all required forms for the prior year.
- May 18, 2023
The GST Act recently issued a guideline where taxpayers need to register their invoices on the IRP within seven days from the issue date. The circular implementation was into effect from May 1st 2023; however, as per the latest report, the circular will come into effect after three months.
As per the GST law, taxpayers can avail of input tax credit benefits on the invoice only after uploading the e-invoice on the IRP portal. The officials have requested taxpayers to register transactions by using the SMS filing method for ‘NIL’ returns to avoid system failure.
- May 11, 2023
As per the latest notification by the CBIC, Central Board of Indirect Taxes and Customs (CBIC), the Department of Revenue under the Ministry of Finance, it was announced that the GST taxpayers who have a yearly turnover of ₹5 crores or more (in any financial year) would be mandated to generate e-invoices for business-to-business (B2B) supply of goods and or services and/ or for exports.
The rule, which will be brought into effect from 1st August 2023, would bring a change to the ongoing system where only those businesses that have an annual turnover of more than ₹10 Crores are obligated to generate electronic invoices for business-to-business transactions.
- May 25, 2023
Natani Precast LLP has sought a judgement from the Rajasthan AAR that GST should be levied on the supply of precast manholes made of steel and cement. A bench of Mahesh Gowla and Umesh Garg has stated that steel and cement precast manholes are tangible and therefore, will be considered as supply of goods and not services.
According to the AAR, the amount that the applicant will charge M/s Larsen & Toubro Ltd., the recipient, for the supply of a precast manhole does not constitute transaction value under Sections 15(1) and 15(2) of the CGST. The recipient will make raw materials freely available and that is outside the applicant's purview for the supply of precast manholes does constitute transaction value for taxation.
- April 25, 2023
The Appellate Authority of Advance Ruling’s West Bengal bench upheld a ruling and stated that right or sale to use a car park is not bundled with construction services naturally. Therefore, it will not be considered a composite supply and a GST of 18% will apply. The ruling of AAAR came in Eden Real Estate’s appeal which is involved in the business of constructing residential apartments. From 1st April, 2019, GST of 5% was levied on non-affordable projects without Input Tax Credit (ITC) . For housing projects that are ongoing, the builder has the choice of paying GST at the old rate of 12%.
- May 22, 2023
On 6 May, 2023, an advisory was issued to the taxpayers by the GSTN, which stated the decision to defer the imposition of the time limit of 7 days on reporting old e-invoices on the e-invoice IRP portals for taxpayers, who have an aggregate turnover of ₹100 Crores or more by three months.
In April, GSTN imposed a timeline for businesses with a turnover of ₹100 Crore and above for uploading e-invoices on the IRP (Invoice Registration Portal), within 7 days of the issue of such invoices beginning 01 May, 2023.
The GST law states that companies/ businesses cannot avail of ITC, Input Tax Credit, till the time the invoices are not uploaded on the IRP.
- May 08, 2023
The Goods and Services Tax (GST) Department is currently looking to gain real-time access to taxpayers’ banking data. This comes in the wake of investigations that have brought to light that undue tax credits that have been accumulated through fake invoices were being used for informal value transfer systems (hawala transactions). The GST Department believes that access to real-time banking data will help detect both excess use of input tax credit (ITC) by businesses as well as fake invoices.
- May 15, 2023
On the night of 10 May 2023, the government released a circular that announced a phased decrease in the turnover limit for e-invoicing. It was stated that registered entities with a yearly turnover of ₹5 Crores or more would be mandated to complete the e-invoicing from 1st August 2023. The limit earlier was ₹10 Crores.
The government has now decided to impose a deadline on businesses to report their invoices (digital invoices) on the Invoice Registration Portal (IRP) to ensure seamless and smooth functioning.
As per the new rule, tax-paying enterprises with an annual turnover of ₹100 crores or more will have to upload their digital invoices of the IRP within seven days from the issue date effective from 1st May 2023.
GSTN further stated that this norm is applicable only on invoices and that credit/debit notes are exceptional. Invoices that are not recorded on the IRP will not be considered for the input tax credit.
The government aims to implement these changes in a phased manner for all taxpayers.
- May 02, 2023
GST cess rate will now be imposed on pan masala and tobacco over and above the existing 28%. This has come into effect from 1st of April, 2023, This means the pan masala and tobacco manufacturers would have to bear cess on the final (absolute) retail price when the product leaves the manufacturing unit.
The endeavour is to help in curbing tax evasion as the cess would be levied at the initial point.
- Mar 10, 2023
A Model All India GST Audit Manual 2023, has been completed for use by the Centre and state tax officials. Considered to be an initiative to assist businesses, and bring down litigation formalities, the manual lays out standard principles for selecting audit cases, preparing and conducting audits and post-audit follow-ups. It is predicted that the move would benefit the Central as well as the state GST officials. They would be able to execute the process in a more consistent manner.
According to the latest GST Network (GSTN) advisory dated April 24, 2023, bank account validation needs to be synced with the GST (Goods and Services Tax) System. The move is considered to be a step in the right direction, as it would ensure the accuracy of the bank account details of all types of GST taxpayers. As per the issued advisory, a taxpayer is to check his/ her bank account verification status on the official portal.
To verify, you need to visit the FO website. On the dashboard of the portal, you would have to click on ‘My Profile’ and then select the ‘Bank Account Status’. You have the option to cross-check your GST-registered email and mobile number to know the status.
- April 27, 2023
April 2023 has been the highest GST revenue collection month for the country. States like Himachal Pradesh have witnessed a 19% hike in revenue collection compared to April 2022. The SGST department report reveals that around ₹500 Crores were collected in April 2022, and ₹593 Crores were collected in April 2023.
The department further stated that officials have verified 94,000 e-way bills during the road checking. An estimated amount of ₹42 Lakhs were collected as a penalty from violators in April. The officials have a target of ₹13 Lakhs for e-way bill verification in FY 2023.
- May 05, 2023
April 2023 has been recorded as the highest GST revenue collection month since the implementation of the Goods and Services Tax in India. As per the reports, ₹1,87,035 Crores have been collected under gross GST revenue.
After analysing, the government official stated that the GST revenue collection is hiked by 12% in comparison to the GST revenue collection from April 2022. A detailed report of ₹1.87 Crores suggests that ₹38,440 Crores, ₹47,412 Crores, ₹89,158 Crores, and ₹12,025 Crores have been collected via GGST, SGST, IGST and cess (including the import of goods as well).
April 2023 also witnessed the highest tax collection day on 20th April 2023 where ₹68,228 Crores were deposited via 9.6 transactions in a single day.
There has been a fair bit of speculation about the rationalisation of the GST regime. However, reports indicate that the GST system of taxation is unlikely to be rationalised any time before the 2024 Lok Sabha elections. A senior government official reportedly stated that the reason behind this was the constitution of the group of ministers (GoM).
This body is responsible for looking into the GST rate rationalisation by the GST Council. Some members in the GoM hail from poll-bound states. So, depending on the outlook of the elections, the panel may have to be reconstituted.
- April 07, 2023
The GSTN has released module-by-module new functionalities for taxpayers to use on the GST portal. Various new functionalities for GST stakeholders are introduced on the GST portal from time to time. These features apply to a variety of modules, including Registration, Returns, Advance Ruling, Payment, Refund, and other topics. Various webinars, as well as informational videos on these functionalities, are held for the benefit of stakeholders and posted on GSTN's dedicated YouTube channel.
From October to December 2020, the GSTN has allowed deposit of fees under the CGST or IGST heads for filing an Advance Ruling application or an appeal. The GSTN has also allowed “Displaying Annual Aggregate Turnover” to taxpayers on their dashboard and “View of Annual Aggregate Turnover of a Taxpayer” on the GST portal.
- May 05, 2021
The services performed by the employees of Profisolutions Pvt. Ltd has been put into question by the AAR (Authority of Advance Ruling) to seek a judgement on whether the services rendered between the branch office and head office will imply 18% tax as per the GST regime. Profisolutions Pvt. Ltd states that employees and their services are a part of the company and are not confined to any geographical aspects.
However, as per the laws stated in the GST Act, every business entity requires registration to function in each state. It was also pointed out by AAR that the exchange of services between two registered businesses in the same or different states under a single person is taxable under the GST regime. Therefore, AAR claims that the services of common employees of business entities with different GST registrations will have GST implied on their rendered services.
- April 20, 2023
The GST collection in India rose by 13 per cent over the GST revenues collected for the same month last year. The GST collection for March 2023 stands at a little over ₹1.60 lakh Crores, as per a statement issued by the Ministry of Finance. The gross GST collection has surpassed the ₹1.5 lakh Crores mark for the fourth time during FY 2022-23. March’s GST collection is also the second-highest one ever. The Finance Ministry said, “The gross GST revenue collected in the month of March 2023 is ₹1,60,122 crore of which CGST is ₹29,546 crore, SGST is ₹37,314 crore, IGST is ₹82,907 crore (including ₹42,503 crore collected on import of goods) and cess is ₹10,355 crore (including ₹960 crore collected on import of goods)". March also witnessed the highest ever IGST collection. The return filing for the month of March 2023 was also the highest ever. The total gross collection for the financial year 2022-23 is ₹18.1 Lakh Crores while the mean gross monthly collection is around ₹1.51 Lakh Crores.
- April 03, 2023
The sale of ice cream would attract either 5% or 18% GST depending on how it’s sold. Ice cream that’s sold over the counter but not prepared in the store would attract a GST of 18% while ice cream that’s ordered with other food items would attract 5% GST.
- Mar 07, 2023
The Maharashtra government presented its state budget on 9th March 2023, where it announced the Amnesty Scheme. In his maiden budget scheme, Maharashtra Finance Minister Mr Devendra Fadnavis declared a big benefit for small traders. Naming it the Maharashtra Settlement of Arrears of Tax, Interest, Penalty or Late Fee Act of 2023. Part of this scheme, he announced that the government would allow a complete waiver of the arrears that are ₹2 Lakh or less, for any year. Dealers with arrears of up to ₹50 Lakhs would only have to pay 20% of the arrears, and the remaining 80% would be waived off. The scheme will come into force from 1st May 2023 to 31st October 2023.
This is the second-highest mop-up since the implementation of GST in July 2017. Around ₹1,55,922 crore gross GST was collected as of January 2023. As per to data from the finance ministry, central GST was ₹28,963 crore, state GST was ₹36,730 crore, integrated GST was ₹79,599 crore (including ₹37,118 crore collected on import of goods), and cess was ₹10,630 crore of the gross GST revenue collected in the month of January 2023 until 5 pm (including ₹768 crore collected on import of goods). The amount collected in January 2023 was ₹1.41 trillion more than it was in January 2022, an increase of 10.6%. This is the second highest collection ever, next only to the Rs 1.68 lakh crore gross collection in April 2022.
- Feb 27, 2023
The High Court of Karnataka has ruled that vouchers do not fall into either category - goods or services and hence, issue and/or supply of the same will not attract any GST. The bench of Justices T.G. Shivashankare Gowda and P.S. Dinesh Kumar remarked that vouchers, be it cashback vouchers or gift vouchers, are just instruments that are generally offered in consideration for the supply of goods and services. They also remarked that vouchers do not have any inherent value and hence, should not be considered as goods or services that are subsequently subjected to the GST.
- Feb 12, 2023
The GST Council Meeting is to be held on the 18th February, 2023 in New Delhi. The meeting will be chaired by Union Finance Minister Nirmala Sitharaman, with state counterparts being present as well. Discussions on taxation of ‘gutka’ and ‘pan masala’ firms are expected. Apart from this, the meeting is also set to also take up discussions on other matters such as online gaming, horse racing and online gaming.
- Feb 06, 2023
June 30, 2022 marked the end of the GST transition period. Any loss of revenue incurred during the five-year transition period due to the introduction of the new tax regime was set to be compensated by the Government of India. According to RBI’s annual publication, this compensation was being met through GST compensation cess on indicated goods and services. According to this data, Maharashtra, Karnataka, Gujarat, Tamil Nadu and Punjab are among the top five compensation-receiving states.
- Jan 30, 2023
The panel of state ministers are planning to recommend a 28% GST on online gaming. Regardless of whether it is a game of chance or skill, but ultimately the final decision on this issue will lie with the GST Council.
Currently, a 18% GST is levied on online gaming. This tax is applied on gross gaming revenue, which is the rate that is being charged by gaming portals online. As per sources, there will not be any further deliberations at the Group of Minister’s level. According to a KPMG report, the sector of online gaming is expected to grow to Rs.29,000 crore by 2024-25 from Rs.13,600 crore in 2021.
- Nov 23, 2022
The Finance Ministry of India stated through Twitter, “There is no consideration in Govt to levy any charges for UPI services. The concerns for the service providers for cost recovery have to be met through other means.” Hence, the Ministry of Finance has confirmed that the Unified Payments Interface (UPI) will not be levied with a GST.
The Ministry further explained that the Government has financially supported the digital payment ecosystem of India for two years now in order to promote digital payment platforms and to urge the people to utilise digital payments as their primary form of monetary exchange.
- Aug 26, 2022
In addition to deleting some further exemptions, the GST Commission may consider another set of rate modifications to address the outstanding instances of inverted duty.
According to the officials, inverted duty refers to systems in which the rate of tax on inputs is higher than the rate of tax on external suppliers, discouraging value creation.
Saurabh Agarwal, a tax partner at EY, stated that the rectification of inverted duty structures in industries such as textiles, electric cars, and others will assist the business in liquidating accrued credits, smoothing working capital concerns, and reducing compliances. Also, resolving inverted tariff frameworks in areas where production-linked incentive (PLI) programs have been implemented can enhance the internal rate of return.
- Aug 19, 2022
As per a recent notice issued by the Board of Central Excise and Customs, perks received by employees do not need to be taxed under GST. This topic has remained a bone of contention for some time now, with previous notifications stating that any transaction between two parties would fall under the purview of GST, even if no considerations were involved. This latest notification follows Schedule III of the GST Act (2017) which states that perks do not fall under the purview of GST, given that they fall under the ambit of the contract of employment.
- Aug 05, 2022
In an effort to reinforce steps towards preventing avoidance, the Central Government has mandated the e-invoicing of GST for firms with a turnover of over ₹10 Crores. This will now bring in 0.36 million more firms under the ambit of the digital framework. The aim of this measure undertaken by the Government is to expand the scope of the digitisation of GST and prevent further evasion by firms. Since its introduction, the e-invoicing system has resulted in the augmentation in the number of taxpayers – from 12.5 million in 2020 to 13.8 million currently. It has also augmented revenue collected from GST, from ₹0.9 trillion in 2018, to ₹1.23 trillion in 2022 and ₹ 1.5 trillion in the first quarter of the financial year 2023.
GST has been introduced on the rent or lease fee paid for residential property from July 18, 2022. As per the new norms, 18% GST will be applied when a person who has not registered under GST gives their property on rent or lease to a GST 'registered person'. The new norms do not apply to tenants who are not registered for the tax.
Under the reverse charge mechanism, the GST-registered tenant has to pay GST for the rented property. If both the tenant and the owner are unregistered parties, these new norms will not apply. Salaried individuals, small business persons, or business entities are not required to register under GST. Service providers with turnover of ₹20 Lakhs and above and goods suppliers with ₹40 Lakh annual turnover and above, must have a GST registration.
- Aug 01, 2022
The government has announced that food grains and products including pulses, cereals, rice, wheat,etc in a single container holding above than 25 kg do not come under the category of pre-packaged and labelled goods. As a result GST will not be imposed on these products.
After receiving criticism for imposing a significant economic hardship on consumers, the Central Board of Indirect Taxes and Customs issued a series of FAQs justifying the 5% fee on the aforementioned commodities.
In addition, under the new rates, if a grocery store sells food goods packaged with any mark for identification of his item solely, or under his own label, a GST will be paid on that food item.
- Jul 25, 2022
Industry professionals believe that the introduction of GST legislation has decreased hurdles across the country and made conducting business easier and more effective for both enterprises and consumers, according to a survey conducted by Deloitte Touche Tohmatsu India LLP.
According to the report, the GST system has significantly impacted the pricing and expenses of products and services to end customers, as well as assisting businesses in streamlining their distribution networks.
Since its introduction, the majority of industry experts believe that overall input credit management in relation to GST regulations is one of the main challenges encountered in complying with the GST legislation.
The statement also stated that automation of tax compliance has resulted in significant economies and advantages as compared to the previous system.
- Jun 17, 2022
An exemption from GST is a relief for all small business owners online. The Central and State government has been continuously discussing the pros and cons of the registration and exemption of the GST process for small-scale e-commerce enterprises.
Currently, every small-scale e-commerce enterprise has to register its firm under the Goods and Services Tax Network irrespective of its turnover and profit ratio, whereas the offline retail sellers do not have to register themselves for GST if their annual sales do not cross Rs. 40 Lakhs landmark. With the approval of this proposal in Parliament, all types of small-scale enterprises will be at par for GST processes.
GST Council is also planning to reduce the tax slab on some items in the next council meeting. As per reports, mass-consumption goods will have 3% and other good categories will have 8% GST applicable after the five per cent GST tax reduction. The council will also revise the non-food items list by moving some of the goods into a 3% tax slab.
Currently, there are four tax slabs in the GST system - 5% tax slab, 12% tax slab, 18% tax slab, and 28% tax slab consisting around 480 items . Around 70% of GST collection comes from the 18% tax slab. The non-branded items are not included in the list and do not significantly contribute to the GST collections.
The GST council is also discussing with the states on increasing the tax slabs on luxury items like perfumes, bags, dry fruits, etc. and a 28% GST will be levied on cryptocurrency to par it with the casinos, lotteries, etc.
The official said that the final call will be taken at the GST council meeting next month
- Jun 03, 2022
The Goods and Services Tax portal is now offering a new service of adding another trade name under the same GSTIN number. The Goods and Services Tax Identification Number is a 15-digit unique number issued by the GSTN (Goods and Services Tax Network).
The GST return forms have separate sections that require the taxpayer to mention the legal and trade name. With this new feature, the taxpayers can register two trade names under one registration with the same PAN card in the same state.
With this, ‘Additional Trade Name’ feature the taxpayers can now operate multiple types of businesses under the same registration and legal name, but with a different trade name.
Owing to pressures relating to inflation and a spate of geopolitical agitations, the Finance Ministry has decided to push the rejig of the rate of Goods and Services Tax (GST). For the time being, the government plans to adhere to its original plan of market borrowing and will gauge other methods of financing subsidies pertaining to food and fertilizer, and income loss on the same, as a part of its process of reigning in inflation.
The government agrees that the timing isn’t right to introduce fewer slabs of GST, as this would translate to higher GST rates on certain goods, raising the prices of consumer goods when the inflation rate has reached 7.79%, the highest in eight years.
The council overseeing GST shall meet later this year in June and shall review Conrad Sangma’s (Chief Minister of Meghalaya) report that favours levying a rate of 28% on racing, online gaming, and casinos. In addition to this, they shall also discuss rates to be levied on ocean freight, which was recently debunked by the Supreme Court.
The government plans to adhere to its borrowing policy even in FY 23 and may also tap into the resources of the Consolidated Fund of India to further its infrastructure spending scheme.
- May 27, 2022
In a recent announcement, the High Court of Gujarat stated that when pertaining to a property that is under construction, builders are eligible to discount the actual land value stated in the contract, for the purpose of paying GST.
Before this announcement was made, builders were required to mandate ‘Value of Land’ as one-third of the total contract value and had to pay GST on the remaining two-thirds.
With this landmark judgment, those looking to purchase under-construction property will greatly benefit, especially in cases where the value of the land exceeds the one-third amount.
When it comes to construction services, the GST levied will be lesser when the actual value of the land in question is deducted from the total value. This deduction will then be advantageous when the percentage of the value of land is greater than 33.33% of the total value.
While ready-to-move-in flats and land are not taxable under GST laws currently, GST is applicable on services relating to construction if the partial or full consideration pertaining to construction is received by the builder before they issue the occupancy certificate.
- May 23, 2022
The Finance Ministry has officially recorded a record-breaking Goods and Service Tax collection of Rs. 1.68 lakh crore in April 2022 by breaking its record of March 2022 when the GST collection was Rs. 1.42 lakh crore. April 20th, 2022, was the highest tax collection day, with a GST collection of Rs. 57,847 crore through 9.58 lakh transactions throughout the day. A sum of Rs. 8,000 crore was deposited between 4 pm - 5 pm via 88,000 transactions, making it the highest GST collection hour of the month. The Ministry of Finance has also disclosed a systematic breakdown of Rs. 1,67,540 crore of GST collection. The department collected Rs. 41,793 crore as SGST, Rs. 33,159 crore as CGST, Rs. 81,939, crore as IGST and Rs. 10,649 as cess. The above-mentioned gross GST collection also includes the tax on imported goods. Compared to April 2021, the country has witnessed a growth of 20% in GST revenue generation, 30% of the revenue earned is from imported goods, and 17% is from domestic transaction services in the first month of the 2022-2023 financial year. The department has also witnessed the responsible behaviour and timely payment of the tax by the citizens due to the strict enforcement of laws and stringent penalties levied.
- May 05, 2022
The government registered collections of Rs. 1.44 trillion, or Rs. 1,40,986 crore in January 2022. The announcement was made by Finance Minister Nirmala Sitharaman as part of presenting her Budget for 2022-2023.
The collection amount is headline-making in many ways: It is the highest since the tax regime was announced. It also beats the previous high of 1.39 trillion by a large margin. It marks a 24% increase over GST collected last year and a 35% over GST collected two years ago.
Why is a high GST collection a good thing? Because it bodes well for the country’s economic status. It reduces the fiscal deficit (or the difference between the government’s expenditure and its income) and it increases the country’s tax buoyancy.
The figure of Rs. 1.44 trillion is indeed encouraging, but one should also note that the amount that has to be refunded to general service taxpayers has not been deducted from this figure, and must be taken into consideration. Meanwhile, the breakup of GST is as follows: CGST contributed to Rs. 24,264 crore, while SGST comprised Rs. 32,016 crore. Rs. 72,030 crore including over Rs. 35 crore from imported goods came from IGST and Rs. 9,674 crore of cess was received, of which Rs. 517 crore came from collections on goods imported.
Lauding taxpayers for due diligence, the finance minister also stated that January 2022 witnessed over 1 crore GSTR-3B submissions.
- Feb 3, 2022
During the time of the pandemic, health insurance became one of the fastest-growing sectors of the insurance market. The medical costs in the country have surged significantly. The paramount importance of health protection paved the way for viewing health insurance as an essential commodity. Now, the insurance sector is pushing for a reduction in the GST on health policies to attract more customers to get insurance coverage. Currently, 18% GST is levied on health policies. Shanai Ghosh, Executive Director & CEO of Edelweiss General Insurance suggests that it should be brought down to the lowest slab of 5%, to make insurance cover more affordable for people. Roopam Asthana, CEO & Whole-Time Director of Liberty General Insurance, believes this will encourage people to purchase health insurance and additional top-up plans.
According to the experts, the pandemic has made people realize the importance of having health insurance. If the government would revise the tax for health policies, it could mend the gap between this realization and reality. The insurance penetration in India is 4.2 percent of the GDP whereas, the global average is 7.4 percent. The pandemic has increased the premium collected under health insurance policies as well as the number of COVID claims. Insurance officials find this an opportunity to increase insurance penetration in the country.
The tariffs at hospitals keep on changing regularly. There are no centralized regulations for the tariff structure and grading in hospitals since health is a state subject. It is crucial to have health insurance coverage to get prepared for unexpected emergencies. A reduction in GST on health policies will bring more people under the insurance umbrella.
- Jan 24, 2022
The Textile Ministry has stated that the removal of the inverted duty structure in the Man-Made Fibre (MMF) sector, as well as the notification of a uniform GST of 12% on MMF yarn, fabrics, and apparel, which will take effect on January 1, 2022, will save working capital and reduce compliance burden, resulting in increased growth and job creation. On the other hand, some manufacturers believe that the decision to impose a universal GST of 12% on all clothing, including those priced under Rs 1,000 and previously subject to a 5% duty, will hurt small businesses.
Other industry players have applauded the government's decision to address the inverted tax structure that has harmed the industry. Addressing the inverted duty structure is a critical reform that will improve manufacturing efficiency while also making GST more progressive. Improving the cost competitiveness of the MMF value chain is critical for a company's next stage of expansion, and this move will aid in that effort.
- Nov 22, 2021
A secondary GST registration is not needed in the state by a subcontractor who is implementing an infrastructure project, according to the Karnataka bench of the GST Authority for Advance Rulings (AAR). In a recent judgement, the bench upheld the principle of 'Ease of Doing Business,' saying the subcontractor can hike the invoice by imposing integrated goods and service tax (IGST) from its location in Noida, Uttar Pradesh.
When goods and services are supplied between states, the IGST is imposed. The AAR's decisions have persuasive power. According to tax professionals, if this judgement is implemented across the country, it will help businesses save money on registration and other miscellaneous expenses.
- Nov 16, 2021
As GST enters its fourth year, the words of our former Finance Minister, Arun Jaitley, delivered in Parliament's Central Hall on the midnight of June 30, 2017, still ring in our ears: "The goods and service tax may be a destination tax, but for India it will begin an entirely new journey." Indeed, on July 1, 2017, India embarked on an entirely new journey with the implementation of the goods and services tax, which is being hailed as one of the country's most significant economic changes, following a decade of deliberation. For all sections of society, the four-year journey has been a roller-coaster ride.
In the last four years, taxpayers' experiences have been varied, with organised and major industrial players adapting quickly to the new GST world, while small and medium firms are still struggling to adjust to the tech-enabled regime. While it is critical that the flaws be addressed quickly, it is also crucial to recognise that reaping the advantages of such a massive structural transformation takes time. The system is still a work in progress, and in such a complex trip, the process of evolution cannot be avoided. In the future, the new India is certain that the government will continue to take steps to fulfil its promise of a "Good and Simple Tax."
- Jul 1, 2021
In view of the second pandemic wave, which in most states has affected economic activity, the Finance Ministry has issued several notifications to provide companies with relief. The government issued notifications relieving companies from the outbreak in accordance with GST law to comply with statutory and regulatory conformity.
In order to reduce compliance burdens during the second wave of pandemic, the Government extended key income tax compliance schedules and GST as well as waived late charges. In order to get relaxation for a maximum of three months, the Ministry of Finance received multiple industrial representatives, as well from MSMEs. Analysts believe that the government will have to expand timelines further due to increasing pandemic cases in the country. For financial year 2019-20 - GSTR-1, GSTR-3 and GSTR-4 as well as submissions of any appeal have been extended for the filing of revised income tax returns and tax payment. The interest rate has been streamlined and in certain cases late fees have been waived off.
- May 3, 2021
The Goods and Services(GST) Tax collections for India have crossed the 1 Lakh Crore mark for the 5th month in a row, in February. The collections for the month of February have dramatically risen by 7% to stand at Rs. 1.13 Lakh crore from Rs. 1.05 Lakh crore last year. The rising GST collections are direct indicators of a rise in economic activity and represent the prosperous state of economic affairs in our country.
The collections are a sigh of relief as the revenue recorded for the month of April 2020 had plummeted to a record low of Rs. 32,172 Crores due to the lockdown. This rise in revenue is also a result of the stringent measures introduced by the government to improve tax compliance.
- Feb 25, 2021
Budget 2021 was praised for striking an admirable balance between boosting the economy, improving medical facilities, and raising funds through privatization rather than raising the tax burden on individuals and businesses. But recently, the Finance Minister introduced an amendment to the Finance Bill that would allow only exports on Letters of Understanding (LUT) without GST and require exporters to apply for Input Tax Credit (ITC) Refund.
Exporters have been seeking to grasp and obey the law's mechanism since the day it was enforced. The IGST refund option was a well-established practice, and exporters were familiar with the required compliances and procedures. Merchant exporters may have to face liquidity problems as a result of the proposed changes, as their margins get thin since they depend on the local market for their purchases.
- March 5, 2021
At the GST Council meeting in March, states are expected to raise the question of a massive shortfall in GST payments before the first quarter of 2022-23. The council may not make a decision on tax slab rationalization or the inverted duty structure in industries like textiles, footwear, and fertilizers.
The council could be unable to make a decision on these matters because the model code of conduct was in effect due to assembly elections in five states. In addition, the council would like revenue to stabilize after the pandemic so that it can make an informed decision. The dates for the forthcoming meeting have yet to be determined. The GST Council is expected to focus solely on administrative issues and debate the recommendations of different committees.