Browsed by
Category: GST News

GST Council meet: States to flag poor revenue mop-up

GST Council meet: States to flag poor revenue mop-up

Revenue considerations are set to play a big role at the meeting of the Goods and Services Tax (GST) Council on Friday with many States expected to raise concerns about muted tax growth.

Sources have indicated that the poor collections under the indirect tax levy are a source of concern for both the Centre and a number of States like Kerala, West Bengal and Delhi.

“A number of States are likely to flag concerns about revenue losses and muted growth trends. Another round of reduction in GST rates could further impact the Exchequer and the bigger worry is that this could potentially be the second year of subdued GST collections,” said a person familiar with the development.

GST mop-up fell to less than ₹1 lakh crore and was at ₹98,202 crore in August and indications are that the trend is likely to continue with the slowdown.

The government had been hopeful that with stabilisation of the indirect tax revenue system and improved compliance, collections should have actually risen to about ₹1.20 lakh crore per month this fiscal.

The Budget 2019-20 has pegged the full year GST collections at ₹6.63 lakh crore, which is a tad lower than the Interim Budget target of ₹7.61 lakh crore. There are already concerns emerging amongst experts on whether this target will be met.

“There is expectation of a revenue shortfall under GST. The Budget estimates are ambitious and with the investment and financial slowdown, the collections are expected to be lower,” said DK Pant, Chief Economist, India Ratings.

Analysts believe that at the current rate of collections, monthly mop-up will have to reach about ₹1.18 lakh crore to meet the Budget target. States are concerned that another round of GST rate cuts could further impact collections with losses estimated at about ₹45,000-50,000 crore.

Bihar’s deputy Chief Minister Sushil Kumar Modi recently said that most States are not in favour of further duty cuts for auto companies.

Kerala Finance Minister Thomas Isaac had said in a tweet earlier this month: “It is not high GST rate that has caused auto crisis. Pre-GST combined tax, excluding service tax, ranged between 32 per cent and 54 per cent. Now, tax including compensation cess ranges from 29 per cent to 46 per cent only. If the Centre is keen to reduce it further, abolish cess. The rate would come down to 28 per cent.”

Source: The-Hindu-Business-Line

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

  • Automate Invoicing and get Paid Faster
  • Integration with all popular accounting software
  • Manage your GST and E-WayBill Software anytime anywhere using multiple devices

Get Our GST Software DEMO and E-WAY BILL DEMO for FREE

Traders demand govt to fix E-way bill threshold to Rs 1L

Traders demand govt to fix E-way bill threshold to Rs 1L

In a shocker for businessmen, the Punjab government’s amendment to double the E-way bill exemption limit from Rs 50,000 to Rs 1,00,000 for inter-state transactions expired on September 13.

This amendment was valid for one year which was issued last year on September 13 after a lot of hue and cry was raised by the businessmen who claimed that the exemption limit of Rs 50,000 was not sufficient.

Meanwhile, ever since the expiry of the amendment limit, businessmen are up in arms against the government as they are of the view that the limit of Rs 1, 00, 000 should be made permanent as reversing the limit back to Rs 50,000 is not viable for them.

Sunil Mehra, state general secretary of the Punjab Pradesh Beopar Mandal (PPBM), said: “The notification doubling the exemption limit under the E-way bill for within the state transactions from Rs 50,000 to Rs 1,00,000 has expired on September 13. This notification was done last year after intervention of the chief minister, Captain Amarinder Singh, when the PPBM apprised him of difficulties being faced by the business community of Punjab due to low exemption limit of Rs 50,000 under the e-way bill system. But unfortunately, no one paid attention to the fact that the notification was valid only till September 13. This is nothing less than a setback for us as we have been maintaining our accounting records as per the new notification only. Not only we will have to go back to the old system, but this will also put an additional burden on us as even a normal transaction these days is for Rs 50,000 and above. Therefore, we request the state government to do something immediately. Rather than extending the notification, the government should make it permanent for within the state transactions.”

Speaking to TOI Rajkumar Singla, president of the Fastener Supplier Association, Ludhiana, said: “If the exemption limit of Rs 1,00,000 from the E-way bill is halved, it will again lead to harassment of businessmen. The state government has failed to fulfil its promises to the business community of Punjab. We are contemplating to campaign and stand up for our rights. Regardless of our repeated representations to the government, no concrete solution has been taken so far, be it costly power, rising cost of the raw material and labour etc. State finance minister Manpreet Badal has been making false promises that limit is being revised again to Rs 1,00,000, but nothing has been done by the government even after four days.”

Kulpreet Malhotra, a senior member of the United Cycle and Parts Manufacturers Association, said: “It is unfortunate that on one hand the industry is undergoing recession and on the other, the exemption limit for interstate E-way bill has been again revised to Rs 50,000. We had to fight a big battle with the state government last year as well. We are now geared up to do anything to get the exemption limit for the E-way bill to Rs 1,00,000 again.”

Notably, the amendment to double the exemption limit for the inter-state (within Punjab) E-way bill was done on September 13, 2018, by the Punjab government.
At that time, a lot of drama was witnessed as the Central GST department (CGST) had opposed the decision of the state government for the amendment and later 11 items were kept in negative list by the state government on which amendment did not apply.

Source: Times-Of-India.

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

  • Automate Invoicing and get Paid Faster
  • Integration with all popular accounting software
  • Manage your GST and E-WayBill Software anytime anywhere using multiple devices

Get Our GST Software DEMO and E-WAY BILL DEMO for FREE

GST: Aadhaar verification to be mandatory for new dealers from Jan 2020

GST: Aadhaar verification to be mandatory for new dealers from Jan 2020

In order to check malpractices in GST, the GST Network on Saturday decided to make Aadhaar authentication or physical verification mandatory for new dealers from January 2020.

“Aadhaar authentication of new dealers will be mandatory. Earlier it was optional. But we have noticed in two years that there’s good number of fly-by-night operators. They make fake invoices,” Bihar deputy chief minister Sushil Kumar Modi, who heads the group of ministers of GST Network told reporters after a meeting here.

Those who don’t want Aadhaar authentication, physical verification will be carried out, which will be completed in three days, he added.

As refunding is a big issue, the GSTN decided on complete online refunding from September 24 this year from a single source, either by the Central GST or State GST, Modi said.

The GSTN also decided the much simplified new return system may be launched on January 1, 2020, the Bihar Deputy chief minister said.

The GST Council meeting is scheduled in Goa on September 20, he added.

Source: Economic-Times.

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

  • Automate Invoicing and get Paid Faster
  • Integration with all popular accounting software
  • Manage your GST and E-WayBill Software anytime anywhere using multiple devices

Get Our GST Software DEMO and E-WAY BILL DEMO for FREE

E-way bills for gold under consideration

E-way bills for gold under consideration

The government is considering a proposal to make e-way bills necessary for transportation of precious metals like gold to stop malpractices and check revenue leakage, two officials said requesting anonymity. Under the GST’s e-way bill system, the movement of goods requires registration from pickup to drop points.

The GST Council, an apex federal body for matters related to indirect taxes, is expected to consider the proposal at its meeting in Goa on September 20. The Union finance minister chairs the GST Council and it has state finance ministers as its members.

The officials said Kerala has mooted the proposal of making e-way bills mandatory for movement of precious stones and metals even as the Law Committee rejected an idea for doing so citing “security and law and order” in June. In July, the matter was again sent for the reconsideration of the committee, which is an advisory body of the GST Council. The panel has about two dozen members, mainly tax officials. Email queries sent to the Central Board of Indirect Taxes and Customs and the Union finance ministry about the proposal went unanswered.

The officials cited above said Kerala has repeatedly flagged the issue and is unconvinced that e-way bills for gold and other precious items will pose security threats and create law and order problems. Kerala has sought e-way bills to check revenue leakages.

According to the officials, the Law Committee has put up two options before the GST Council. The first option is to make e-way bills mandatory through encrypted mode. Under this option, data related to the movement of such goods will be stored in a server and only authorised officials could have access to it. This will address the security concern.

The other option is to continue with the existing exemption from the requirement of e-way bills as these goods are often transported personally or privately through the traditional couriers called ‘angadia’. It has been underlined that insistence on e-way bills for these items will increase the compliance burden for workers, the officials said.

Ease Your GST Retrun Filing & Invoice with XaTTaX- GST Software

Source: Hindustan-Times
GST Council meet: Rate cut for auto sector may not be easy; relief on hotel tariffs, biscuits on the cards

GST Council meet: Rate cut for auto sector may not be easy; relief on hotel tariffs, biscuits on the cards

The GST Council meeting, as per the agenda paper, may take up automobiles, hotels, biscuits, matchsticks and outdoor catering segments for resetting of the GST rates. However, all listed items may not see GST cut due to various complexities involved

With the government desperate to reverse the prevailing economic slowdown, the GST Council is all set to make major announcements on Friday. The high-powered GST Council will discuss the agendas on tax cuts for sectors with the high-consumer interface or high distress amid a significant fall in demand and sales.

The GST Council meeting, as per the agenda paper, may take up automobiles, hotels, biscuits, matchsticks and outdoor catering segments for resetting of the GST rates. However, sources suggest all listed items may not see the GST cut due to various complexities involved.

The automobile sector, which is virtually driving the current economic slowdown, has been demanding a reduction in GST on cars to 18 percent from 28 percent for long. The auto players feel the GST meet is happening at the right time — in a few days from now, the festive season will kick-start and companies will roll out offers to boost sales. They say a rate cut along with festival offers could reinvigorate the auto sector. Several states, including Kerala, which fear it’ll lead to a drop in revenue, have opposed the move. The GST Council’s fitment committee had assessed the rate cut impact on the auto sector and also said it would seriously hurt the GST collection, as auto sales contribute almost Rs 50,000-60,000 crore to the total GST collection.

Sources, however, say it’s more of a political call the govt has to take. The Centre may also explore the possibility of a significant cut for a certain period to assist the sector. But the industry players feel a limited period offer will not address the persisting crisis, as prices are likely to shoot up again with the introduction of BS-VI compliant vehicles. This will again push the sector towards a crisis, which is why the auto manufacturers are pushing for a long-term solution. They have also demanded a significant GST cut for low engine capacity two-wheelers, which are not luxury items.

There could be some cheer for the hotel industry. The government is likely to provide relief to the luxury hotel category, which charges Rs 7,500 per night or more and invites a 28 percent levy. A source said with the government’s added emphasis on tourism, including Prime Minister Narendra Modi’s call to travel to different destinations in India, the GST Council might raise the ceiling for the 18 percent tax category to Rs 10-12,000 per night.

Outdoor caterers, who are charged 18 percent tax, may also get some relief. The matchstick and matchbox industry has been struggling due to the two kinds of GTS taxes, and the Council may provide some relief to them too.

Sectors such as cement and textiles may also get some good news in terms of GST cut.

With the GST collection dipping to sub Rs 1-lakh crore mark last month, the Council is also considering raising the taxes on items, which are unofficially called “sin goods”, like tobacco. The move could help the Centre increase its revenue.

Get Your GST Returns Filed Easily and
Effortlessly!!!

Our GST software enables you to file your GST returns free of any hassle. Get more details by writing to us at gst@xattax.in.
Source: - businesstoday.in
Ahead of GST Council meet, biscuit makers hope for rate cut

Ahead of GST Council meet, biscuit makers hope for rate cut

Biscuit makers are hoping for a lowered tax rate on widely consumed mass biscuits priced below ₹100 a kilo as an increased instance of GST has put additional burden on manufacturers.

The GST Council is expected to meet on 20 September and could consider tax revisions on various goods. Auto and biscuit manufacturers are hoping for a reduced tax burden amid a slump in consumer demand.

Mayank Shah, category head, Parle Products, and vice president, Biscuit Manufacturers Welfare Association said biscuit manufacturers are hoping for a reduced tax burden on lower-priced biscuits or those priced below ₹100 per kilo from the current 18% to 5%.

“Our request is to continue the distinction between two categories of biscuits ie those below and above ₹100 per kilo because the sub ₹100 per kilo biscuits are targeted at the middle class and lower strata of the society—the consumption is huge there,” Shah told Mint. “We are okay paying 18% GST on biscuits priced above ₹100 per kilo,” Shah added.

Biscuits priced below ₹100 per kilo include largely affordable biscuits such as glucose, and milk and account for 25% of all biscuit sales in India; these are typically priced under ₹10. Earlier in September, the Biscuit Manufacturers Welfare Association, which represents close to 40 biscuit makers, including Parle Products, made fresh petition to the government seeking a reduction on tax slabs.

To be sure, biscuit makers have been seeking a reduction in taxes on biscuits in the mass market segment since 2017, after the government clubbed them in the same tax bracket as premium cookies or those priced above ₹100 per kilo, thus doing away with a varied tax structure under the new GST regime.

This, companies added, has prompted manufacturers to reduce the size of biscuits offered per pack amid growing cost pressures and even take price hikes leading to a slump in demand. Shah added that in the first quarter of the current year premium biscuits or cookies grew between 7% to 8%; while mass biscuits or those priced below ₹100 per kilo declined by 8%, he said citing industry figures.

India’s biscuit market is estimated at over ₹31,200 crore and sees the participation of large companies such as Britannia Industries, Parle Products, ITC, Mondelez India, among others. It is among the largest categories of packaged foods sold in India.

But an increased instance of tax has burdened manufacturers who complain that they have had to resort to price hikes or cut the grammage of biscuits priced under ₹10 to ensure consumer demand is intact. Shah added that last December the company took measures to control costs and has since reduced the number of biscuits sold in its ₹2 to ₹5 packs, including Parle-G —India’s largest selling biscuit.

“We had absorbed the costs for a while, but then last December we started to reduce the quantity offered so that we don’t pass on the prices to consumers,” Shah said. He added that the company had to rule out price increase in ceratin packs as shoppers are “extremely value-conscious, they notice things like this and easily switch to cheaper alternatives.” For Parle, biscuits priced under ₹100 a kilo account for 40% of its sales.

Anmol Industries, which sells namkeen, butter and cream biscuits priced between ₹5 to ₹20, said it has been gradually reducing the size of some of its biscuit packs over the last two years as raw material prices, especially wheat, continue to climb. “Earlier we used to have a 60 gram pack at ₹5, today it has been brought down to 45 grams and if this continues we could soon be selling 40 grams,” said Gobind Ram Choudhary, managing director at the company.

Choudhary who is also part of the India Biscuit Manufacturers Association, an industry body of ten biscuit companies in the North, made representation to the government to reduce the GST on biscuits are priced below ₹150 per kilo to 12% about two months ago. “For us these account for 90% of our sales,” he added.

The move to push to lowered tax rates comes amid a slowdown in consumer demand largely aggravated by a slump in rural consumption where consumers are holding back on purchases of essentials such as household products and staples. This has spooked FMCG companies, which draw over 35% of sales from the hinterland.

In its quarterly update on the FMCG sector for the April-June quarter, research firm Nielsen said that categories such as salty snacks, biscuits, spices, soaps and packaged tea led the slowdown during the quarter. Nielsen also lowered its guidance for the sector for the full year.

XaTTaX: Cloud and On-Premises Based GST Filing Software For India

Source: Live-Mint.
State tourism ministers seek cut in GST on hotel rooms to boost sector

State tourism ministers seek cut in GST on hotel rooms to boost sector

Tourism Minsters from different states today urged to reduced GST for hotel rooms. They also asked for simplification and rationalisation of various taxes and levies to attract tourists and take on global competition.

“The Tourism Ministers’ conclave 2019 at Kovalam, Kerala notes with concern that the GST Council of India has imposed 28 per cent GST on hotel room tariff over Rs 7,500 and 18 per cent tax on rooms with tariffs between Rs 2,500 and Rs 7,500. This tax rate is high compared with other countries,” said a resolution unanimously adopted by the conclave.

The resolution, moved by Karnataka Tourism Minister C T Ravi, said reduction in GST in hotel rooms is essential to attract more tourists.

The resolution also sought measures to reduce high airfares, as they are compelling leisure tourists to explore alternative global destinations.

“We express concern over the high airfares during peak season and festivals, which are forcing holiday-makers to opt for economical destinations. Besides, unexpected closure of certain airlines/carriers has led to increased airfares while minimal air connectivity with 2-tier and 3-tier cities has only compounded the problem,” it stated.

The conclave also took note of the high and varied inter-state tourist vehicle taxes and called for its rationalisation across all the states to ensure seamless travel.

In another resolution, the conclave proposed formation of Regional Tourism Councils and developing tourism circuits, which can be region-based and in neighbouring states. “We resolve to jointly promote our tourist attractions across the world in order to give a cutting edge to our campaigns,” it said.

The resolution, moved by Odisha Tourism Minister Jyoti Prakash Panigrahi, said setting up Regional Tourism Councils will facilitate periodic interaction among different states and enhance collaboration.

Union Minister of State (I/C) for Tourism and Culture Prahlad Singh Patel, according to a press release from the State government, said while the Centre would extend its support to development of tourism in all states, it is necessary to think about ‘one nation one tax’ regime.

“We should revisit our perception about GST. Tourists come not only to stay in hotels. We have to also think about one nation one tax. There is also the issue of transport tax. All states should evolve a consensus to streamline it,” he was quoted as saying.

Describing e-Visa as a revolutionary step, he said the Centre has taken some steps to streamline it and make it more tourist-friendly.

Source: Business-Standard.

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

  • Automate Invoicing and get Paid Faster
  • Integration with all popular accounting software
  • Manage your GST and E-WayBill Software anytime anywhere using multiple devices

Get Our GST Software DEMO and E-WAY BILL DEMO for FREE

Government to fix GST leaks, shore up collections at GST council meeting on Friday

Government to fix GST leaks, shore up collections at GST council meeting on Friday

Goods and Services Tax (GST) council meeting is scheduled for this week in Goa. The centre is planning to tighten the processes that include input tax credit claim and will emphasise on getting the states to approve the plans to plug leaks and evasions. 

It is expected that the government’s effort to brace up collections and improve the revenues is going to be a major area of the discussion during the upcoming GST council. Demand for rate cuts for the stressed sectors such as autos likely to figure but new procedures to prevent evasion and GST provisions are expected to be adopted.

It may be noted that on an average business pay 20 per cent of their tax in cash and rest of the amount using the tax credit accumulated in their accounts. Using the same math, the Ministry of Finance is looking to ask the states to put in place a mechanism under which enhancement in the limit to claim tax credit will require payment of 20 per cent as the margin money, according to a news report in a national daily.
This means that if your turnover is Rs 50 lakh and you wish the limit to be enhanced to Rs 60 lakh, then you will have to pay Rs 2 lakh as the margin money.

“This is like linking your loan to your credit history. If a business has received orders, it will have to convince our officers about a higher limit or talk to banks and get 20 per cent extra. The entire process will be automated to avoid any discretion,” as explained by an officer.

After more than two years of launch of GST, the collections have been around Rs 1 lakh crore due to the leakages, when it comes to claiming input tax credit (ITC) on the tax paid during the entire chain from purchase and transport of raw material to sale of the final product by a retailer, sources told the national publication. 

Therefore, plugging the gaps and finding ways to step up collections are going to be main topics of the discussion at the GST council meeting in Goa on Friday. The Centre and states are looking at a massive shortfall in GST revenue, where collections so far in the year has grown over 6 per cent, which is half the asking rate. The tight fiscal position is also expected to force the council to defer a decision on tax cuts, which is being demanded by certain industry groups.

Source: Times-Now-News.

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

  • Automate Invoicing and get Paid Faster
  • Integration with all popular accounting software
  • Manage your GST and E-WayBill Software anytime anywhere using multiple devices

Get Our GST Software DEMO and E-WAY BILL DEMO for FREE

GST network releases online version of two simplified forms for taxpayers

GST network releases online version of two simplified forms for taxpayers

The Goods and Services Tax Network (GSTN) on Friday released two forms– ANX-1 and ANX-2–for simplified online returns.

A taxpayer will have to file FORM GST RET-1 (normal), or FORM GST RET-2 (Sahaj), or GST RET-3 (Sugam) returns. Annexure of supplies (GST ANX-1) and annexure of inward supplies (GST ANX-2) will also have to be uploaded on the tax portal as part of these returns.

GSTN had earlier released the offline tools of these forms.

With the release of the online version of GST ANX-1 and GST ANX-2, the supplier taxpayers have now been provided with a facility to fill in details of business-to-business (B2B), business-to-consumer (B2C) and details of supplies attracting reverse charge in their online.

“The online version will provide working on real environment, and we would appeal taxpayers and tax consultants to use the online features and share feedback to help us make changes/ enhancements wherever required,” said Prakash Kumar, chief executive officer of GSTN.

The new simplified returns will replace the existing forms by January 2020.

Source: Business-Standard.

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

  • Automate Invoicing and get Paid Faster
  • Integration with all popular accounting software
  • Manage your GST and E-WayBill Software anytime anywhere using multiple devices

Get Our GST Software DEMO and E-WAY BILL DEMO for FREE

15th Finance Commission to meet advisory council on GST mop-up

15th Finance Commission to meet advisory council on GST mop-up

Amid muted growth in GST collections threatening to strain the government’s fiscal maths, the 15th Finance Commission will meet here on Friday with its advisory council consisting of leading economists, including Chief Economic Advisor K. Subramanian.

Official sources said that the main item on the meeting agenda is the projection of GST revenues in the coming years and plotting the way forward for centrally-sponsored schemes.

The Advisory Council includes noted economists such as Arvind Virmani, Surjit Bhalla, M. Govinda Rao, Omkar Goswami and Pinaki Chakraborty.

The meeting of the Finance Commission with the panel of 12 economists is being held days ahead of the Commission Chairman N.K. Singh discussing the indirect tax collection trends with the all-powerful GST Council on September 20 in Goa.

“Given the GST collection trend so fa,r many states have urged the Finance Commission to extend the period for GST compensation beyond the initial five years. Further, the economic outlook is not looking very bright. The Finance Commission Chairman would meet the GST Council in this context,” an official said here.

The gross GST collection in August 2019 grew 4.51 per cent year-on-year to Rs 98,202 crore but continued to remain below Rs 1 lakh crore mark reflecting the economic slowdown realities on the ground.

Finance Minister Nirmala Sitharaman had, in July, significantly lowered her projections for GST collections in the Budget for 2019-20, against the Interim Budget presented in February. Accordingly, the Centre expects collections this year to be around Rs 6.63 lakh crore, down 13 per cent against the earlier estimate of Rs 7.6 lakh crore.

The government’s worries have, however, grown over the last few months with the GDP growth in the April-June quarter slowing to a six-year low of 5 per cent. Negative sales in the automobile sector and slowing volume of fast moving consumer goods (FMCG) items have sounded alarm bells for the government

Source: Economic-Times

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

  • Automate Invoicing and get Paid Faster
  • Integration with all popular accounting software
  • Manage your GST and E-WayBill Software anytime anywhere using multiple devices

Get Our GST Software DEMO and E-WAY BILL DEMO for FREE