0% GST for 29 handicraft products welcomed

The State government’s efforts to raise the issue of 0% tax for handmade products, following appeals from civil society groups, seems to have yielded results. On Thursday, the Goods and Services Tax (GST) Council decided to bring 29 handicraft products under the 0% tax rate.

The issue was taken up at the GST Council after the Gram Seva Sangha, which is spearheading the movement seeking 0% tax on handmade products, had submitted a petition to the Karnataka government. Noted theatre personality Prasanna, who also went on an indefinite fast, had met senior government functionaries to convince them on the need to protect the handmade sector.

On Wednesday, Deputy Chief Minister of Bihar, Sushil Kumar Modi, who also chairs the Group of Ministers set up to look into technical glitches in the GST, had also acknowledged that the council would be considering tax benefits for the handicraft sector.

a welcomed the GST Council’s decision, but will continue to seek tax benefits for all handmade items across the country.

Mr. Prasanna, who has been vociferously campaigning for 0% tax through tax-denial satyagrahas, termed the decision as a good move. “We welcome the decision. This is the first step towards achieving better value for handmade products,” he said.

Incidentally, a 14-member committee set up by the sangha, under the leadership of noted sociologist Ashish Nandy, has identified over 200 handmade products across several sectors, including fisheries, agriculture, and forest produce, and has also come up with the definition of handmade. The committee report was submitted to the Karnataka government, following which the State government raised the issue at the GST Council.

“We will study the full implication of the decision and decide on the future course of action,” Mr. Prasanna said. He also said another padayatra will be launched from Kodekal in Yadgir taluk, the birthplace of sufi saint Kodekal Basavanna from Janaury 30.

“Through the padayatra, we want to highlight the need to achieve better value for handmade products. We will trace the 15th century saint Manteswamy, who had also brought together artisans.”

Source:http://www.thehindu.com/news/national/karnataka/0-gst-for-29-handicraft-products-welcomed/article22466837.ece

GST Council approves changes to composition scheme

 The goods and services tax (GST) council on Thursday approved changes to the composition scheme for small dealers to ensure a seamless supply chain, make the scheme more attractive and check tax evasion.

The changes will enable large registered dealers to purchase from small composition scheme dealers and still avail of input tax credit, said a person familiar with the development.

At present, small dealers up to a turnover of Rs1.5 crore have the option to go in for the composition scheme wherein they can pay a low fixed rate of tax and face a lesser compliance burden. Under the composition scheme, traders have to pay 1% tax, manufacturers 2% and restaurants 5%.

However, one disadvantage was that input tax credit cannot be availed of by the traders under the scheme. Further, they are also not allowed to raise GST invoice which would help the buyer to take input tax credit.

This meant that large registered dealers were wary of purchasing from such entities registered under the scheme.

As per the decision of the council, large registered dealers can pay the tax equivalent to the composition rate on purchases made from small unregistered dealers.

This mechanism, also known as reverse charge mechanism, will enable the buyer to avail of input tax credit.

At the same time, the composition dealer will be exempt from paying the tax on the purchases made by the registered dealers. To be sure, amendments will have to be made to the GST laws to enable these changes.

Source:http://www.livemint.com/Politics/CFMSWGVTEAftsK9BTEIFlO/GST-Council-approves-changes-to-composition-scheme.html

GST on 29 items, 54 services cut; experts say govt must ensure e-way bill process is bug-free

The all-powerful GST Council cut tax rate on 29 goods, including second-hand vehicles, confectionery and bio-diesel, while veering around to simplifying return filing process for businesses. Also, tax rate on 54 categories of services, including certain job works, tailoring services and admission to theme parks, have been lowered.

The panel at its next meeting may also consider bringing under the Goods and Services Tax (GST) purview items like petroleum and real estate which are currently outside the new regime, Finance Minister Arun Jaitley said.

The Council cut GST rate on second-hand medium and large cars and SUVs from 28 percent to 18 percent and on other old and used motor vehicles to 12 percent.

Tax on diamonds and precious stones was slashed to 0.25 percent from current 3 percent.

While tax rate for bio-diesel was slashed to 12 percent from 18 per cent, that for public transport buses run on environment-friendly bio-fuels has been reduced to 18 percent from 28 percent previously.

Tax rate on irrigation equipment, sugar boiled confectionery, drinking water packed in 20-litre bottles, fertiliser grade phosphoric acid, tamarind kernel power, mehendi paste in cones, LPG supplied by private distributors, articles of straw, velvet fabric and rice bran was also cut. The new rates would be effective from 25 January.

The Council, in its 25th meeting on Thursday, also discussed process to make return filing simpler with just one return to be filed every month.

Infosys non-executive chairman Nandan Nilekani made a presentation on simplification of the return filing process. The Council discussed the possibility of retaining only GSTR-3B or initial sales return, while mandating sellers to upload their invoices.

Jaitley said the GSTR-3B and the invoices can be matched by tax officers; and in case of difference, at a later stage businesses can be asked to explained.

“It was finally culminating into filing 3B returns and supplier invoice, which would be adequate,” he said, adding that the Bihar Deputy Chief Minister Sushil Modi, GSTN chairman Ajay Bhusan Pandey and Nilekani would formalise the structure and a final decision would be taken at the next meeting of the Council. Asked if filing only one return is the way forward, he said “that seems to be the course”.

Businesses at present have to file GSTR-3B as well as GSTR-1, which is the final invoice wise sales returns. Jaitley said the next meeting may also consider bringing items that are currently in GST within the new tax regime.

The Goods and Services Tax (GST) was rolled out from 1 July, 2017 by subsuming most of the Central and State indirect taxes into a single tax. But, crude oil, natural gas, diesel, petrol and ATF have not been included in the ambit of GST as of now. Also, real estate was kept out of the GST.

The minister further said that a nation-wide roll out of e-way bill will happen on 1 February for inter-state transportation of goods through roads. Additionally, 15 states have said they will also start off with e-way bill for intra-state movement of goods on the same day. “Therefore, the trade and transport industry have to comply with,” he said, adding that the e-way bill would act as anti-evasion measure.

In view of declining GST revenues, the Council, chaired by Jaitley and comprising his state counterparts reviewed the collections in the new indirect tax regime.

Jaitley said so far the government was relying on unilateral declaration made by the business, and in view of declining collections, there was a need for anti-evasion measure.

“So far it was voluntary compliance without anti-evasion measures. With all anti-evasion measures put in place, the collections will pick up,” he said.

The GST revenue mop-up has been steadily declining over the month as from over Rs 95,000 crore collected in July, it has come down to about Rs 81,000 crore in November.

Jaitley further said that tax revenues from businesses opting for composition scheme was a matter of “serious concern” as 17 lakh businesses who have opted for the scheme have paid a cumulative tax of Rs 307 crore in the first quarter. “There seem to be under declaration as far as collections from composition scheme are concerned,” he said.

Some tweaking in the scheme is expected when the Council discusses amending the Central GST, State GST and Integrated GST Acts in its next meeting, which will be held through video conferencing.

The amendments to these laws would be placed before Parliament in the second leg of Budget session. The first phase of the session will be from 29 January to 9 February. After a recess, Parliament will meet again from 5 March to 6 April. Besides, in view of a hefty Rs 35,000 crore unclaimed credit lying in form of IGST collections, the Council also decided to provisionally divide the amount equally between the
Centre and states.

“It will ease indirect tax position of the Centre and states. In direct taxes, we are ahead of target… In last few months, direct tax has grown substantially,” he said.

Besides, the Council also accepted the report of the CBEC Chairperson Vanaja Sarna headed committee on handicraft sector. Now the fitment committee will decide on which handicraft items the rates could be lowered.

Experts react

M S Mani, director, Deloitte India: It is expected that an announcement on the return simplification process in the next meeting in ten days would be good if the views of industry are also taken into account in the process as the taxpayers would have many useful suggestions to offer. It appears that the some anti evasion measures will be rolled out over a period of time starting with the e-way bill. – this seems to be influenced by the lower collections in the past two months.

It is clear that the e-way bill is only the first step in curbing GST leakages, several more steps such as reintroduction of reverse charge on transactions with unregistered dealers, scrutiny and audits should now be expected the reduction in rates on several services and goods which are highly employment oriented indicates that the government has considered the larger economic impact of GST the fact that 15 states are rolling out the e-way bill for transactions within the state from 1st February, although they had time till 1 June, indicates that there is significant concern on introducing anti evasion measures. We should expect more steps such as reintroduction of RCM to follow.

Pratik Jain, Leader-indirect Tax, PwC: Two most crucial decisions in terms of simplification of return process and most legislative changes have now been deferred to next meeting. While simplification and merging multiple monthly returns into a single return would be good in concept, it needs to be ensured that invoice level details are made available to the buyers on a real time basis so that remedial action can be taken without waiting for assessment or audit.

Rates have again been rationalized on few items, which is a step in the right direction. One would expect that over next few months, this process would continue, particularly with respect to 28 percent category, which should only be for select luxury and demerit products. In many cases like works contract services or used motor vehicles the reduction of rate might have been due to restriction of input credit. Therefore, there is a good case to further liberalize the input credit regime.

There are indications that reverse charge levy on purchase from unregistered businesses could come back for composition dealers, which is important to plug the possible tax leakage. The highlight of the meeting was focus on ‘anti evasion’ measures due to dip in revenue collection. This could mean tightening of tax administration over next few months, which industry would need to be prepared for.

Mahesh Jaising, partner, Deloitte India : The 25th GST Council  meeting appears to primarily have been focussed on rate reduction in respect of handicrafts and agricultural products with the Council rationalising GST rates on 49 handicraft goods, 29 agricultural products and 54 category of services. The Finance Minister further clarified that there would be no deferment in implementation of e-way bill. The Council reaffirmed its decision on introduction of e-way bill system on inter-State movement of goods on trial basis w.e.f January 15, 2018. However, penalty in case of defaults in compliance with e-way bill requirement will be made applicable from March 1, 2018. The industry would need to gear up to put a system in place on an immediate basis to ensure compliance with this system to avoid any situations of goods getting stuck at check posts, penalties being imposed, etc.     

The GST Council also expressed the concern that the response to composition scheme has not been satisfactory with a possibility of understatement of turnover. In order to encourage more taxpayers to register for composition scheme, the Council may recommend necessary amendments in the GST Act including amendments in the reverse charge mechanism to benefit the taxpayers.

Vishal Raheja, DGM, Taxmann: It was highly expected that GST Council would decide the fate of petroleum products under GST to remove cascading effect but unfortunately no decision has been taken yet. Also, all powerful GST Council has not finalized single form return under GST which was the main agenda of meeting. But it is important to note that GST on 29 handicrafts items have been reduced to zero percent which will increase competitiveness in international markets and exports will increase which in turn boost economy. One another major decision which is taken today is to implement mechanism of e-way bill from 1 February.

Abhishek Jain, tax partner, EY: Keeping in mind the revenue evasion concern, the Union Finance Minister reiterated introduction of E-way Bills w.e.f. February 1, 2018 for inter-state transactions. Further, 15 States have decided to implement E-way Bills for intra-state transaction as well w.e.f. February 1, 2018 even though they had an option to do it on or before June 1, 2018. Accordingly, it will be very critical for the industry to immediately set up processes around the entire E-way Bill requirement and also train their supply chain team and transporters in this area. Also it is important that the Government portal for issuing E-way bills works bug-free. If either the industry is not ready or the Government IT system is not smooth, it may result in a severe supply chain bottleneck.

Atul Gupta, senior director, Deloitte India: The GST Council decisions do exhibit the urgency on the part of the Government to implement the E-way bill to check the possible tax evasion. Again, the fact that GSTR 3B ( summary returns filing) is intended to be continued without any requirement to upload purchases data for availing input duty credit implies that the government may be rethinking the onerous GST law which mandates matching of input GST paid by the buyer against the output GST paid by the seller for availing input duty credit. The extension of 0 percent duty on 29 handicraft items is a welcome boost to manufacturers and exporters of handicrafts. The industry still awaits the extension of GST to real estate and petroleum sectors which form a sizable chunk of the revenues collected by the States and Centre and which would make for a more comprehensive GST.

Priyajit Ghosh, partner, Indirect Tax, KPMG in India: A lot of decisions were expected out of the 25th meeting while not many of them appears to be finally decided for implementation. However, it appears that progress has been made on a few relatively complex areas such as simplification of return filing system, tweaking the composition scheme, introduction of reverse charge on certain transaction.

Consensus appears to be in favour of continuance of summary level filing and invoice level supply filing, in some form, instead of detailed 3 return monthly filing system. E-way bill system to be implemented from 1 February is likely to see enhanced level of enforcement as the Government banks on the system to arrest the declining GST collections. No lesser expectation is from the next council meeting, ahead of the Union Budget by the end of this month, which is likely to finalize many aspects including first discussion on inclusion of real estate and petroleum products in GST.

Abhishek A Rastogi, partner, Khaitan & Co: With an object of generating employment and ease of doing business, certain key decisions have been made. As a corollary, rates were amended for 29 goods and 53 services. This is indeed a populist move including decision of 40 handicraft items. Another important measure is with respect to Form 3B which will continue but has been simplified. The suppliers invoices remain a basis for tax payment and credits claimed.

As an anti-evasion measure, E-way bill to be operative with effect from February 1 for inter-state transactions. 15 States have announced it even for infra-state transactions. This time the compliance starts after robust system testing. While the direct tax collections are well ahead of target, the indirect tax collections needs to be closely watched especially in light of huge IGST credit and transitional credits.

Vinay Sethi, head, market development, tax and accounting, Thomson Reuters, South Asia: The 25th meeting of the GST council held against the backdrop of falling GST collections resulted in some positives such as reduction of GST rates on handicraft goods as the higher rate of GST would have adversely impacted the large population employed in handicrafts industry; reduction in rates of multiple services; expediting of efforts towards simplification of return filing process and consolidation of GSTR-1,2 and 3; commitment to bring the petroleum products and real estate under the purview of GST sooner than later.

Mandatory Issuance of inter-state e-waybill from next month is an anti-evasion measure that the government has introduced and it is important that the platform provided to businesses is robust to provide hassle free compliance of the e-way bill process.

R Muralidharan, senior director, Deloitte India: The simplification of GST return filing process has got the required attention of the GST Council it deserves. Based on the presentations made to the Council, it is hoped that the Government will in its next meeting approve a simplified return which the industry is eagerly waiting for. The reduction of tax rates for 29 goods and 53 categories of services in today’s GST Council meeting coupled with the reduction of tax rates on over 200 items in November will impact the already strained GST collections.

Source:http://www.firstpost.com/business/gst-on-29-items-54-services-cut-experts-say-govt-must-ensure-e-way-bill-process-is-bug-free-4309667.html

UDAN: Viability gap funding to get 3-year exemption from GST

The GST Council today decided to provide a three-year GST exemption for viability gap funding given under the regional air connectivity scheme.

The scheme, also known as UDAN (Ude Desh ka Aam Naagrik) seeks to connect unserved and under-served airports as well as make flying more affordable. The participating airlines are eligible for VGF subject to certain conditions.

The Council meeting, chaired by Finance Minister Arun Jaitley, has recommended issuance of certain goods and services.

These include extension of “GST exemption on Viability Gap Funding (VGF) for a period of three years from the date of commencement of RCS airport from the present period of one year”, according to an official release.
The civil aviation ministry contributes 80 per cent of the VGF amount, while the remaining comes from the state governments concerned and in the case of north-eastern states and Union territories, the sharing ratio is 90:10.

Source:https://economictimes.indiatimes.com/news/economy/policy/udan-viability-gap-funding-to-get-3-year-exemption-from-gst/articleshow/62559443.cms

GST return: UT bags second spot in country

Five months after the roll out of the Goods and Services Tax (GST), Chandigarh ranks ranked second in the country when it comes to the percentage of GSTR-3B return filing. Punjab secures the top spot, while Delhi is ranked third. GSTR-3B is a monthly self-declaration that has to be filed as registered dealer. As per the record of the UT excise department, there are around 17,000 registered GST traders in the city.

According to official figures, which were reviewed earlier this month, by the finance secretary of government of India, the filing percentage varied between 96.86% to 79.02% from July to November. The Punjab figures were recorded between 97.55% to 84.37 % in the same period.
Against the national average of 90.92% in July, 96.84 % of traders filed GSTR-3B return, while in August 92.99 % traders of the city filed their return against the national average of 85.27%. September saw 89.72% of traders filing returns. The national average recorded in September was 81.19%. In October, against the national average of 77.18%, 85.05% of traders filed returns, while in the subsequent month, the return figure was recorded at 79.02% against the national average of 69.93%.

Spelling out the reasons for the high percentage, city-based GST expert Ajay Jagga said the city has lesser number of registered traders as compared to other cities. He added that majority of the traders in the city are educated and well-versed with technology. “There is very good network between the excise department and traders,” said Jagga. He also lauded the department for running awareness programmes for the traders before launch of the new taxation system
The UT administration had stationed GST awareness seva raths at around 60 locations for the benefit of the trading community for redressal GST issues. More than 20 workshops were organised by the UT excise and taxation department to educate the dealers about various provisions of GST. The department had also released pamphlets carrying bullet points and other details related to GST.

Source:https://timesofindia.indiatimes.com/city/chandigarh/gst-return-ut-bags-second-spot-in-country/articleshow/62561029.cms

HUL Offers To Set Aside Rs 119 Crore For Consumer Safeguard Fund

Hindustan Unilever Ltd. had already offered to set aside Rs 119 crore towards the consumer safeguard fund, the FMCG major said after it received a notice from the anti-profiteering body for not passing on the benefits of lower GST rates to the consumer.

The maker of Wheel detergent said it has proactively disclosed an estimated value of Rs 119 crore to the Central Board of Excise and Customs and offered to pay this amount suo motu to the government. “This amount is not recognised as revenue and is accounted as a liability as on 31st December 17,” the company said in a press release accompanying its earnings statement.

The Goods and Services Tax Council in its Nov. 10 meeting had reduced the rates on these categories of products to 18 percent from 28 percent earlier. The lower rates came into effect from Nov. 15.

HUL failed to lower prices for certain categories of products such as detergents and dishwashing soaps, as reported in an earlier BloombergQuint story. Yesterday, the anti-profiteering body under GST, the Directorate General of Safeguards issued a profiteering notice to the company.

“Due to paucity of time, it was not possible to immediately pass on the benefit of the 15th November GST rate reductions on some of the pipeline stocks to the end consumers,” HUL said in its press statement, explaining why it failed to cut prices.

When queried about the notice, HUL had told BloombergQuint in an emailed statement that it remains committed towards ensuring that all benefits arising from reduction in GST rates are fully passed on the consumers.

Source:https://www.bloombergquint.com/gst/2018/01/17/hul-offers-to-pay-rs-119-crore-after-gst-profiteering-notice

 

Government To Distribute Rs 35,000 Crore IGST Between Centre, States

The GST Council today decided to provisionally divide Rs 35,000 crore collected as Integrated Goods and Services Tax between the Centre and state governments.

The central government will get about Rs 17,500 crore, and the remaining would be distributed among all the states in the proportion in which they are currently getting IGST, a government official told BloombergQuint requesting anonymity.

Division of IGST between the will boost the indirect tax position of the central and state governments, Finance Minister Arun Jaitley told reporters after the 25th meeting of the GST Council today. IGST is paid on inter-state transactions, and credit on the tax paid can be claimed during subsequent level of transactions.

This will be a temporary measure, but with GST collections on a declining trend both for the Centre and states, the government could look at regularising it, the official quoted above said.

The government collected Rs 80,808 crore GST for November as on Dec. 25, said a statement by the Ministry of Finance. That compares with Rs 83,346 crore collected in October, Rs 92,150 crore in September, Rs 90,669 crore in August, and Rs 92,283 crore in July, according to statements issued by Ministry of Finance.

The GST Council today decided to provisionally divide Rs 35,000 crore collected as Integrated Goods and Services Tax between the Centre and state governments.

The central government will get about Rs 17,500 crore, and the remaining would be distributed among all the states in the proportion in which they are currently getting IGST, a government official told BloombergQuint requesting anonymity.

Division of IGST between the will boost the indirect tax position of the central and state governments, Finance Minister Arun Jaitley told reporters after the 25th meeting of the GST Council today. IGST is paid on inter-state transactions, and credit on the tax paid can be claimed during subsequent level of transactions.

This will be a temporary measure, but with GST collections on a declining trend both for the Centre and states, the government could look at regularising it, the official quoted above said.

The government collected Rs 80,808 crore GST for November as on Dec. 25, said a statement by the Ministry of Finance. That compares with Rs 83,346 crore collected in October, Rs 92,150 crore in September, Rs 90,669 crore in August, and Rs 92,283 crore in July, according to statements issued by Ministry of Finance.

The GST Council today decided to provisionally divide Rs 35,000 crore collected as Integrated Goods and Services Tax between the Centre and state governments.

The central government will get about Rs 17,500 crore, and the remaining would be distributed among all the states in the proportion in which they are currently getting IGST, a government official told BloombergQuint requesting anonymity.

Division of IGST between the will boost the indirect tax position of the central and state governments, Finance Minister Arun Jaitley told reporters after the 25th meeting of the GST Council today. IGST is paid on inter-state transactions, and credit on the tax paid can be claimed during subsequent level of transactions.

This will be a temporary measure, but with GST collections on a declining trend both for the Centre and states, the government could look at regularising it, the official quoted above said.

The government collected Rs 80,808 crore GST for November as on Dec. 25, said a statement by the Ministry of Finance. That compares with Rs 83,346 crore collected in October, Rs 92,150 crore in September, Rs 90,669 crore in August, and Rs 92,283 crore in July, according to statements issued by Ministry of Finance.

The proportion of IGST that would go to each state may be calculated by applying the projected revenue growth rate of 14 percent with 2015-16 as the base year, another senior finance ministry official said. The mechanism for this would be finalised soon, he added.

If a basis for settlement of IGST funds is being created it would only be an artificial one as of today, Bipin Sapra, an indirect tax partner at EY India told BloombergQuint.

Ultimately states are looking for more revenue and IGST is a parking fund, not a fund that centre or states have an access to, but it will eventually be divided between the two.

Bipin Sapra, Indirect Tax Partner, EY India

It’s also possible that the IGST that is being distributed will be utilised as credit in future, Sapra added. Taxpayers claim credit for IGST paid when an actual transaction takes place.

“This would be a provisional way of doing it, in the sense that what will come later is being divided now to assuage the problem of both states and the Centre,” Vanaja Sarna, chairperson of Central Board of Excise and Customs told BloombergQuint. “This is just a solution which is temporary for this year.”

Source:https://www.bloombergquint.com/gst/2018/01/18/government-to-distribute-rs-35000-crore-igst-between-centre-states

India Ratings projects GDP growth at 7.1% next fiscal; says GST, insolvency law major drivers for economy

 India Ratings and Research on Thursday projected the country’s economic growth to improve to 7.1 percent next fiscal from 6.5 percent this year, buoyed by robust consumption demand and low commodity prices. In its outlook for 2018-19, the agency said there will be a gradual pickup in growth momentum owing to structural reforms like GST and Insolvency and Bankruptcy Code (IBC) in place.

“While the implementation of GST is likely to benefit the economy over the medium to long term, the same cannot be said about the impact of demonetisation,” India Ratings & Research (Ind-Ra), a subsidiary of Fitch Ratings, said. Ind-Ra expects gross domestic product (GDP) to grow 7.1 percent year-on-year in 2018-19, it said. The projection is a tad lower than 7.4 percent growth estimated by Asian Development Bank (ADB) and International Monetary Fund (IMF)

Ind-Ra said but for demonetisation and Goods and Services Tax (GST) implementation, growth would not have decelerated to 7.1 percent in 2016-17 and 6.5 percent in 2017-18. With the global crude prices firming up, Ind-Ra expects retail and wholesale inflation to come in at 4.6 percent and 4.4 percent, respectively in 2018-19, indicating an end to the current rate cut cycle.

There is still some fuzziness with respect to the intensity and the level of its future trajectory, it said, adding that the RBI “will remain in a pause mode for an extended period of time”. The agency said it expects fiscal deficit in 2017-18 to come in at 3.5 percent, overshooting the budgeted estimate of 3.2 percent.

“Despite 2018-19 being a pre-election year, Ind-Ra does not expect the Union Budget to be a populist budget. However, it expects some expenditure reallocation with an increased focus on the rural and agriculture sectors,” it said.

The agency expects fiscal deficit in 2018-19 to be at 3.2 percent, higher than 3 percent stated in the medium-term fiscal policy statement. A mix of global and domestic factors will keep the Indian rupee range bound at average Rs 66.06/USD in 2018-19, it said.

Source:http://www.firstpost.com/business/india-ratings-projects-gdp-growth-at-7-1-next-fiscal-says-gst-insolvency-law-major-drivers-for-economy-4308581.html

Consumer helpline data indicates traders are charging GST over MRP

As the goods and services tax (GST) Council gets down to further simplifying of the rules, data on consumer complaints and grievances regarding the tax will provide some insight on how the general public has responded to the new system and the problems they encounter.According to records maintained by the National Consumer Helpline (NCH) in the initial few months after the tax change in July 2017, around 11 per cent of complaints came from consumers who say they were being charged GST by traders, but weren’t provided correct bills or the GSTN number. This was the case in the initial couple of months.From the traders’ side, the highest number of complaints or queries on the helpline (around 13 per cent) was on registration, cancellation, correction, and return filling under the GST.About 58 per cent of calls on the helpline were general enquiries about the GST and how it should be dealt with.Other grievances related to traders charging higher than the GST slabs or more than the maximum retail price in the name of GST, continuing to charge value-added tax, and delay in delivery of products, services refund or replacement.

These complaints came over July and August.Though the NCH is not mandated to look specifically into GST-related enquiries and complaints, it has maintained a record of these. The NCH is a project of the Union Ministry of Consumer Affairs, and was recently shifted from the University of Delhi to the Indian Institute of Public Administration.The helpline adopts a three-tier approach while dealing with problems related to defective products, deficiency in services, and unfair trade practices. Officials said all queries and complaints regarding the GST were duly sent on to the agencies concerned.The ministry says it has begun a multimedia campaign to make consumers aware of the tax and on products on which it is not applicable.

Source:http://www.business-standard.com/article/economy-policy/consumer-helpline-data-indicates-traders-are-charging-gst-over-mrp-118011700986_1.html

GST e-way bill: Old wine in a new bottle

The future is here, but it is much inspired by the past, a case in point being the e-way bill.

The nationwide e-way bill system, rolled out on 16 January on a trial basis, will help businesses and transporters to get a hang of the new mechanism that becomes mandatory in a fortnight.

From 1 February 2018, all interstate movement of goods worth more than Rs50,000 will require securing an e-way bill through prior online registration of the consignment. The e-way bills system for intra-state movement of goods will be implemented from 1 June 2018.

Wary of declining goods and services tax (GST) revenues, the government hopes to plug tax leakages by implementing the e-way bill system. It’s a concept that is unique to India. Globally, businesses continue to rely on an invoice for transporting goods, which is mostly in an electronic format. This invoice, issued by the seller, acts as proof of sale and the transporter is required to carry a copy of it, say tax experts.

In India, an e-way bill was being used by businesses even in the pre-GST era. In fact, way-bill/entry tax as it was earlier called has been in existence in certain states for over two decades now, i.e., from the days of service tax and value-added tax (VAT).

According to tax experts, the way-bill was issued by VAT authorities in the form of a printed booklet only to those businesses/dealers who were regular taxpayers. However, manual issuance of way-bill booklets resulted in harassment by tax authorities and boosted corruption, so a few years ago states like Karnataka and Andhra Pradesh computerized it. That is how the way-bill became electronic.

There are around 10 states where e-way bills are already being used. In fact, e-way bills have been given different names in different states. “For instance, it is called e-sugam in Karnataka, e-Transit pass in Uttarakhand, e-Road Permit in Jharkhand and Bihar, Challan Inward/Outward in Sikkim. In the Union territory of Puducherry, e-way bill will be introduced for the first time,” said Archit Gupta, founder and chief executive officer of ClearTax, an online tax services firm. Under GST it will have a uniform name and format, but the original concept has been modified.

For instance, the e-way bill will be valid for a specific time only, unlike in the erstwhile tax regime. Another differentiating factor is that a seller can issue bulk e-way bills in case of multiple consignments worth more than the threshold, which was a tedious task in the VAT regime.

A key positive is that businesses will now have to deal with a standardized e-way bill form for transporting goods across the country, unlike in the earlier system where different forms had to be filled for transporting goods to different states. What remains unchanged is the objective—keeping a check on tax evasion by tracking the movement of goods.

Some tax experts say the government could have devised a better technique to check revenue leakages instead of burdening the entire system with these e-way bills, which they fear may act as a hindrance to the seamless movement of goods.

Source:http://www.livemint.com/Money/MI3IWWcMwANhr8bANKlmhJ/GST-eway-bill-Old-wine-in-a-new-bottle.html