GST Return Simplification:
- GSTR 1 and GTR 3B will continue for the next 6 months.
- New Single-return plan will go live after 6 months. Thus, there will be only 12 returns a year, instead of 36 returns.
- The information required to be filled in the return will be reduced. This will simplify the return preparation task and help in keeping with the philosophy of ease of doing business.
- Post the new return going live, provisional credit can be claimed by the return preparers in the transitional phase of 6 months based on self-calculations.
- The GSTN shows the buyer, invoices uploaded by the seller and thus buyer can check the gap between the credit claimed by him and actually allowed to him.
- Invoices uploaded by the seller during anytime in a month shall be considered as a valid document to avail input tax credit by the buyer.
- After 6 months of the transition period, if it is noticed that after uploading the invoices, the seller has not paid the tax amount to the government, GSTN has all the right to recover these taxes from the buyer. There will be no automatic reversal of credit from the buyer in these cases.
- No provisional credit can be claimed after this 6 month transition period.
- Nil return preparers and Composition dealers will file GST returns quarterly
- Sugar Cess implementation has been postponed. The government believes that there should be a better way to increase revenue for the benefit of the farmers.
- Duties on Ethanol – Reduction in rate suggested.
- A group of ministers expected to work on these two above mentioned points and make recommendations within two weeks.
Incentives on digital payments
- Incentives here may need more time to come in force. A 5 member council will work on this before the next council meet. The proposal is to give a concession of 2% on GST rates that are more than 3% on B2C supplies. The cap of the incentive will be Rs. 100 per transaction.
De-Privatization of GST
- The GSTN will now be a government owned company, with the government acquiring the remaining 51% equity currently held by the Non-Governmental Institutions. In future, the Central Government will hold 50% and State Governments the balance balance 50% of the stake holding. The holdings by the state governments will be on pro-rata basis based on the GST ratios.
- There is a scope for better employment as GSTN looks forward to recruit more people
The expectations from the 27th GST council meet included –
Simplified return filing and ITC claiming process:
- A comprehensive single return with details of inward and outward supplies. This will reduce the number of returns, help in invoice matching and have all details in one place. Focus will be on making everything tech savvy, on the move and supporting the idea of Digital India.
- Simplified ITC claiming process is the need of the hour to avoid waiting for confirmations, acceptances from the recipient or tedious tasks of uploading sale/purchase details to avail the credit.
- A possible process wherein the E-Way bill is checked just once during transit
- Alternate lines for uploading details for generating EWBs in case of un-supported formats
- One-nation, one format for generating E-Way bill were states will avoid having their own forms in addition to the basic notified ones.
Reverse Charge Mechanism:
- Preponement of applicability of Reverse charge mechanism(Before June 30). This could be initially only for a particular class of taxpayers, say dealers under composition scheme.
- Imposition of a cess on sugar to help farmers
- Include Real Estate/transfer of property into the GST regime
- Amendment of the ITC provision in the GST to enable any business to take credit on any business-related expenses (employee transport etc.)
- Exemptions for payments made by employees for the services received from the employers (eg: canteen services)
- Based on various adjudications on anti-profiteering norms under GST, some clarity is expected from the council
- Encouragement for digital transactions by providing cash backs, discounts, credits etc.