- The Cabinet today approved replacing the Goods and Service Tax (Compensation to States) Ordinance by a bill, said sources.
- The GST (Compensation to States) Act 2017 aims to provide compensation to the states for the loss of revenue arising on account of implementation of Goods and Service Tax Act, they said. It provides for imposition of compensation cess on intra-state or inter-state supplies of goods and services.
- The GST Council in its 20th meeting held in August had recommended an increase of 10 percent to 25 percent in the maximum rate on certain type of motor vehicles.
- The Ordinance was promulgated on Sep. 2, thus raising the maximum rates.
- Article 123 of the Constitution mandates that the ordinance be approved by the Parliament within six weeks of reconvening.
- Accordingly, the sources added the finance ministry had sought Cabinet nod for the replacement of the ordinance by the Goods and Service Tax (Compensation to States) Bill, 2017.
- The government has listed the bill for introduction in its Parliament business agenda for next week.
- The Indian government ignored several warnings from private companies that the complex technology required for a nationwide goods and services tax (GST) to work smoothly was not ready for launch, several people who worked on the project said.
- Weeks before the July 1 start of India's biggest tax overhaul in decades, the government declared itself ready and chided industry experts who said more time was needed to prepare for the changes.
- "It's not a complicated process," Finance Minister Arun Jaitley said on June 20.
- However, more than 10 tax and IT consultants who worked on the project said that behind the scenes the government was ignoring warnings for more testing of the complex system even as it was pushing through late changes.
- While the sources said Infosys, which built the GST technological network, made "basic errors", they said government officials have not accepted any responsibility for the glitches in the GST roll out.
- The government is still making changes to tax rates, filing deadlines, and other features, making it difficult to stabilise the system, they said, declining to be identified for fear of losing future government contracts.
- Ferrying goods across states may get quicker from next month with the GST Council set to approve on Saturday an all-India rollout of electronic-way bill from January, three months ahead of the earlier plan.
- The council, headed by finance minister Arun Jaitley, will meet on Saturday via video conference to advance the implementation of e-way bill under the Goods and Services Tax (GST).
- “As of now six states, including Karnataka are ready for rollout of e-way bill. Some states wanted the e-way bill to be implemented soon as there is need to keep a check on consignments,” a senior government official told Moneycontrol.
- Under Goods and Services Tax (GST) rules, ferrying goods worth more than Rs 50,000 within or outside a state will require securing an electronic-way or e-way bill by prior online registration of the consignment.
- To generate an e-way bill, the supplier and transporter will have to upload details on the GST Network portal, after which a unique e-way bill number (EBN) will be made available to the supplier, the recipient and the transporter on the common portal.
- Introduction of e-way bill will enable tax authorities track inter-state and intra-state movement of goods.
- Since the idea of invoice-matching has also been deferred till March 31, the Council may put in place a system that would checking the gaps in exchange of goods and services, the official said.
- In a bid to catch in a bid to catch tax evasion, the concept was invoice matching was devised under the new indirect tax system, under which all taxable supplies would be matched against supplies received.
- The invoice matching, has however, been deferred for few months to reduce compliance burden on taxpayers and encourage more return filing.
- In the 22nd GST Council meeting in October, Jaitley had said that e-way bill will be introduced in a staggered manner, with effect from January 1, 2018, adding that the document will be made fully applicable from April 1. The provisions surrounding the bill was finalised in August.
- The introduction of the e-way bill has been a contentious issue, with businesses protesting against the burden of additional paperwork and processes that would come along with it.
The GST Council seems all set to rollout the electronic-way bill under the Goods and Services Tax (GST) regime. The all-powerful council chaired by Finance Minister Arun Jaitleywill reportedly take a call on early implementation of e-way bill, along with ways to check tax evasion when it convenes on Saturday through video conferencing.
In the 22nd monthly GST Council meeting, Arun Jaitley had declared that the e-way bill be introduced across India in a staggered manner from January 1, 2018 and the document will be made compulsory by April 1 next year. The need to review the rollout schedule of e-way bill emerges from the decline in GST revenue for October, which fell by Rs 12,000 in comparison to the preceding month. Government earned Rs 83,346 crore from GST in October, the lowest since the GST rollout on July 1, whereas the tax collection figures for September were Rs 95,131 crore.
Moreover, Arun Jaitley had said yesterday that the GST Council has prepared schedule with regard to e-way bill to check tax evasion. "I think Council has already taken decision with regard to time schedule, with regard to e-way bill itself. That will help in enhancing collection," he had said.
An e-way bill is required for movement of goods worth more than Rs 50,000. Under the GST regime, transporters will have to procure e-way bill from the GST Network portal when hauling goods worth more than Rs 50,000, within or outside a state. Provisions regarding the e-way bill were finalised in August earlier this year. The objective is to streamline movement of goods across and inside state borders and keep track of inter- and intra-state goods transport for taxation purposes.
To generate an e-way bill, the supplier and transporter will have to enter details of the haul in the GSTN portal. This will create an unique e-way bill number which will be sent to the supplier, transporter and the receiver. The e-way bill thus generated will be valid for a period of 15 days, with one day of travelling for 100 km and 15 days for more than 1,000 km transit.
Invoice matching is also another issue that reportedly might feature prominently in the agenda for GST Council meeting tomorrow. Devised under the GST regime, invoice matching is meant to check tax evasion by matching all taxable supplies against the received supplies. The practice was put on hold in the earlier days of GST to make compliance easier.
- The shortfall in the revenue estimated for all states for first four months of the Goods and Services Tax is about Rs 39,111 crore, West Bengal Finance Minister Amit Mitra said today.
- For all states, revenue of Rs 43,013 crore a month is protected, according to Mitra. For four months, it should have been Rs 1.72 lakh crore and "we got Rs 1.33 lakh crore", Mitra said during a panel discussion at FICCI's 90th annual general meeting.
- The protected revenue from all sources under the GST is estimated assuming a 14 percent growth. Any shortfall has to made up from the compensation fund.
- States collected Rs 87,238 crore through State GST for July to October, according to a government press release. For inter-state trade, Rs 31,821 crore was released to states. An additional Rs 13,882 crore was released for settlement, the release said.
- Going by the numbers for the first four months, Mitra said he was worried that the amount due from the central government to the state could rise to Rs 80,000 crore by the end of the financial year.
- Sushil Kumar Modi, deputy chief minister of Bihar, also part of the panel, said he was optimistic that states will not need GST compensation after two to three years.
- Remove Tax Details From Consumer Invoices, Says Modi
- Modi also suggested that the break-up of detailed taxes in invoices issued to consumers should be removed. Only the maximum retail price should be mentioned, and other details should be omitted, he said.
- Giving an example of New Zealand, Modi said invoices up to $1,000 there don't have the tax-break up.
- Case For Petroleum Under GST
- Modi also hinted at allowing states to levy taxes over and above GST if items like petroleum are brought under the new nationwide sales tax. "People think that the products will be in the highest slab after petroleum products are brought under the GST. But states will have the liberty to levy taxes over and above GST."
- Modi said states get 40 percent of their revenue through petroleum and earn another Rs 31,000 crore from electricity duty. The GST Council will try to bring electricity, real estate, stamp duties, and petroleum products under the new indirect tax regime in the coming days, he said.
- Haseeb Drabu, Jammu and Kashmir finance minister, said bringing petroleum under the GST looks more likely than the inclusion of real estate. The GST Council should wait for the system to stabilise till March to bring real estate under the new regime, he said on the sidelines of the event.
- Need To Ease Composition Scheme
- The Composition Scheme needs to be redesigned to allow claiming input tax credit for businesses that purchase supplies from dealers who have opted for the scheme, Drabu said.
- Traditional supply-chain networks have been broken as big businesses are not buying from dealers who avail the scheme as input tax credit is not available to them, he said.
- Under the composition scheme, traders and manufacturers pay 1 percent of their turnover as GST. Those who opt for the scheme and businesses who buy supplies from such dealers cannot avail input credit.
- Also, anomalies in inputs being taxed at a higher rate than outputs will drive future rate reductions, he said.
- SURAT: When Congress and BJP candidates have been visiting the textile markets to appease traders upset over Goods and Service Tax (GST), a section of traders have started circulating videos of police atrocities during the GST agitation in July.
- With just two days to go for polling, the video footages of police personnel indulging in lathi-charge on traders at Millenium Market and Salasar Gate on Ring Road have gone viral on WhatsApp groups of the textile traders on Wednesday.
- There is a message attached to the video appealing the traders to remember those days when the police had broken their legs and heads when they were doing peaceful protest against GST.
- The message also appeals the traders not to forget the lathi-charge of BJP government and take revenge by casting their vote to Ashok Kothari, who is Congress candidate from Majura assembly constituency and a trader himself.
- A section of textile traders supporting Kothari had organized his felicitation at the Millineum Market on Wednesday and remembered those days when they were brutally beaten up by the police when they were protesting peacefully against the GST.
- In the last few days, a galaxy of national leaders have descended the textile markets to meet the traders and seek support for their respective party candidates.
- A textile trader Ajay Gupta wrote on a WhastApp group, "Now it is our time to give them the reply. When we had gone to meet finance minister Arun Jaitley in New Delhi, he did not even have the courtesy to ask us to sit in front of him. We stood there and represented our demands. It was an insult of the traders' community. Now, we have to insult his party on December 9."
- Revenue collections from the Goods and Services Tax could pick up over the coming months as provisions such as e-way bills for transport of goods kick in, Finance and Corporate Affairs Minister Arun Jaitley said on Thursday, stressing that lower direct and indirect tax rates are only possible when government’s tax kitty expands.
- Reacting to the U.S. Government’s move to slash Corporate Tax rate from 35% to 21%, the Finance Ministry said the fine print will need to emerge in order to understand how much of an advantage it created for American firms and termed it as a manifestation of the protectionist trend in the developed world.
- “Whether it is trade policies or fiscal policy in some regimes, they seem to be impacted by this trend,” said Mr. Jaitley. “I think we will have to wait for the fine print to see how much of an advantage it is. Because any regime, at the end of the day, its accounts have to tally. And if they don’t tally, it creates a further uncertainty itself,” Mr. Jaitley said.
- “Which country in the world has a 5% entry point rate on direct taxes? Ten is the least any country has. You had to resort to a 5% tax in order to nudge non-compliant sections of society to get into the tax structure and get into this habit of paying tax,” he said on GST.
- Similarly, he referred to talk about small enterprises being impacted by the GST, and said the GST Council had proposed a composition scheme to levy 1% tax on enterprises with a turnover of upto a ₹1.5 crore. “Now, again, can anybody tell me which country in the world has 1% indirect tax?” he asked. “It is only when your taxation base in a formalised economy expands that your ability to rationalise rates increase. Rationalisation of rates in a non-compliant society is always more challenging and more difficult. It’s only when your collection basket increases then you can cut rates. That applies to both direct and indirect taxes,” he said.
- Reacting to concerns expressed by some State Finance Ministers that the revenue shortfall under GST had been higher than expected, Mr. Jaitley said, “There are future stages. One is with regard to reduction of compliance burden which, I think, is a legitimate concern and the GSTN is doing this in a phased manner.”
- “There are other stages, GST invoice matching, e-way bills… Now, that’s going to really make sure that evasion becomes all the more difficult. The Council has already taken some decision with regard to some time frame for the e-way bills itself. That itself will help in bumping up collections somewhat,” he said. After healthy GST collections in the first three months, tax collected in October had dipped by about 10% compared with September.
- Minister for Industries and Commerce, Chander Parkash Ganga today met Union Minister for Textile Smriti Zubin Irani and discussed various developmental projects for J&K pertaining to textile sector.
- During the meeting that lasted for an hour, Chander Parkash Ganga briefed the Union Minister about different projects already submitted to the Central Wool Development Board relating to components /sub components of Pashmina Development Programme under PMDP at the cost of Rs. 50.00 crore.
- He also informed the Union Minister of the three projects submitted by IICT under the infrastructure support Scheme of NHDP regarding up-gradation of design bank, testing lab and setting up of CFC costing Rs. 4.56 crore . He also laid stress on the setting up of Indian Institute of Handloom Technology at Jammu and also the introduction of diploma course in Handloom and Handicrafts technology.
- The Minister also requested Union Minister to release Rs 5.75 crore pending final instalment of central share of the scheme distribution of 8000 modern carpets looms under Mega Carpet Cluster Scheme.
- The Union Minister responded positively to the issues discussed during the meeting and gave assurance that centre would give a positive look to all projected demands/ proposal and also expedite the process of sanctioning and release of funds.
- The GST Network said it has introduced a functionality which simplifies the returns filing process for taxpayers.
- "A new functionality has been introduced on the GST portal for ease of the taxpayers under which questions will be posed as soon as the taxpayer enters the Returns dashboard and only relevant tiles will be displayed to the taxpayers based on the answers to the questions posed," the GST Network said in a statement.
- This has been started first with GSTR-3B returns (initial sales return ), it added.
- For 'nil' GSTR 3B returns , one-click filing has been introduced as no tile will be shown to such taxpayers. Also, a help section has been provided on each page for the convenience of the taxpayer.
- "Until now, taxpayers were shown all tiles with payments when they enter the Returns dashboard but now they will be shown only those tiles which are relevant for them.
- "They will be asked questions and basis their response, they will be shown only relevant tiles," said Prakash Kumar, CEO of the Goods and Services Tax Network (GSTN).
- The new facility will result in time savings for the taxpayers, said GSTN, which provides the IT backbone for the new indirect tax regime.
- The Centre urged taxpayers to correct their TRAN-1 forms to avail transitional credit under GST by December 27, failing which the government would be forced to initiate audit proceedings in cases of high credit claims.
- The Finance Ministry said while it had received some claims for high transitional credit for which there were legitimate explanations, it had also noted that several claims were not bonafide. This behaviour, the ministry said, could erode the trust between tax authorities and the taxpayers.
- “It has been noted that some taxpayers have availed extraordinarily high transitional credit of CGST which is neither commensurate with the trend of input tax credit of the industry nor as maintained by the taxpayer himself in the past,” the Finance Ministry said in a statement. “Some of these high transitional credits may have a bonafide explanation or may be a case of bonafide mistake. However, it has been noted that high transitional credit has been claimed in many cases for which perhaps no bonafide explanation exists. Analysis to identify such units is underway.”
- Government To Replace GST Ordinance With Bill
16 Dec 2017
- Government ignored warnings over GST roll out: Sources
16 Dec 2017
- Nation-wide e-way bill set for rollout from Jan; GST Council to meet on Sat
16 Dec 2017
- GST Council likely to rollout e-way bill across India in urgent meeting tomorrow
16 Dec 2017
- States' GST Revenue Shortfall In Four Months At Rs 39,111 Crore, Says Amit Mitra
15 Dec 2017
- Video of police atrocity on textile traders go viral
15 Dec 2017
- GST collections could rise on e-way bills: FM
15 Dec 2017
- Ganga meets Union Minister for Textile
15 Dec 2017
- GST Network simplifies returns filing process
14 Dec 2017
- Fix GST credit claims or face scrutiny
14 Dec 2017