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GST panel recommends no extra tax incentives for digital transactions

GST panel recommends no extra tax incentives for digital transactions

A ministerial panel headed by Bihar Deputy Chief Minister Sushil Modi on Sunday decided to recommend to the Goods and Services Tax (GST) Council to take the final call on the way reverse charge mechanism will be applicable.

Concerns related to revenue prompted another ministerial panel, also headed by Modi, to defer GST discount to consumers making digital payments for about a year.

On May 4, the Council had discussed the proposal of giving a concession of two percent in the GST rate (where tax rate is three percent or more) on B2C supplies, for which payment is made through cheque or digital mode. In that case, the ceiling for the discount will be capped at Rs 100 per transaction.

While the Group of Ministers (GoM) is in favour on incentivising digital payments, PM Modi said it is better to wait for some time till revenue stabilises further.

The GoM, hence, recommended the GST Council to defer the incentives for now.

The GST Council will decide on businesses that will have the liability to pay tax on reverse charge. Towards this, the GoM has suggested deleting sub-section (4) of section 9 of the Central GST (CGST) Act, 2017.

The ministerial panels will submit their report to the GST Council that is expected meet on July 21 in New Delhi.

Since the implementation of goods and service tax in July last year, reverse charge mechanism – one of the key measures against tax evasion – has been deferred thrice and this time till September 30.

Earlier during the year, some states had insisted that the reverse charge mechanism should be re-introduced, as it will help tax authorities plug revenue leakages. Thereafter, a GoM headed by Modi was formed to decide on the exact shape and form of RCM if the government decides to implement it.

Reverse charge is a mechanism where the recipient of the good or service will have to pay GST, which is otherwise paid by the supplier. The charge is applicable on a registered dealer if he buys goods from a dealer not registered under GST. However, the receiver of the good is eligible for input tax credit, while the unregistered dealer is not.

Registered taxpayers (supplier) were not willing to take the burden of paying tax, while small or unregistered taxpayers were running out of business as these registered dealers were hesitant to buy goods from them. Keeping this in mind, GST Council in October, 2017 had temporarily suspended RCM, as it was increasing compliance burden on taxpayers.

Source: Money Control
GoM to meet stakeholders today to discuss GST return filing process

GoM to meet stakeholders today to discuss GST return filing process

A Group of Ministers (GoM) headed by Bihar Finance Minister Sushil Kumar Modi Sushil Modi : GSTwill be meeting different stakeholders today to devise a simple, single-stage return filing process, to reduce compliance burden and ease procedures for businesses under GST.

Non-Executive Chairman of Infosys Nandan Nilekani, officials from Central Board of Indirect Taxes and Customs (CBIC), along with GST Network (GSTN) Ajay Bhushan Pandey will also be present at the meeting.

The GoM was set up by the GST Council to make the GST return filing process smooth and less complex, especially for the small taxpayers. Despite a couple of consultations with IT experts over the last four months, meetings have remained inconclusive.

In the last meeting in March, the GST Council discussed two alternate models for simplification of return filing. However, there was no definitive view regarding the same. Tax officials have been deliberating whether provisional input tax credit should be provided to businesses and if it should be linked with payment of tax under GST.

“Tax bureaucracy of states and the Centre felt that simplification should not provide room for evasion…the Council was of the view that there should be single return every month, it should be simple, not prone to evasion and (look at) how to simplify it further. So no decision was taken today. The existing system will continue for another three months (till June 30),” Finance Minister Arun Jaitley had said during the last Council meeting.

Currently, tax assessees file only two sets of forms — GSTR3B (summary form) and GSTR1 (outward supply or goods sold).

GSTR3B is a summary form, which a business is supposed to file before the 20th of the following month. However, a taxpayer does not have to provide invoice level information in the form.

The erstwhile plan of return filing through three key forms—GSTR1 (outward supply), GSTR2 (inward supply) and GSTR3 (the final netted out return)—has been temporarily suspended owing to the complexities in the process.

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Source :  MoneyControl
Merchant trade transaction no longer vulnerable to GST: Kerala AAR

Merchant trade transaction no longer vulnerable to GST: Kerala AAR

The Authority for Advance Ruling (AAR) under the GST (goods and service tax) in Kerala held that merchant trade transactions, in which traded commodities never GSTenter the country’s tax jurisdiction, are not liable to the GST as goods are never imported to India.

In merchant trade transactions, a supplier is India procures goods from an overseas supplier and supplies directly to its overseas customer. In such transactions, goods do not come to the country.

Goods are liable to IGST (integrated GST) when they are imported to India and the IGST is payable at the time of import of goods into India, the authority said in its ruling.

“The applicant is neither liable to GST on the sale of goods procured from China and directly supplied to the US, nor on sale of goods stored in the warehouse in the Netherlands, after being procured from China, to customers, in and around the Netherlands, as the goods are not imported into India at any point,” the order said.

According to the GST Act, an advance ruling pronounced by AAR is the binding only on the applicant who has sought the advance ruling and on the officer concerned or the jurisdictional officer in respect of the applicant. This means that an advance ruling is not applicable to similarly placed other taxable persons in the state. It is only limited to the person who has applied for an advance ruling.

“While earlier, such transactions were not subject to VAT or service tax, there was an ambiguity under GST laws. Therefore, this AAR provides relief to industry, particularly in commodity trading where such transactions are quite common,” Pratik Jain, leader – indirect tax at PwC, said.
Jain said while it has been held that the GST is not required to be paid on such transactions, another important question which has not been asked in the application filed for this ruling is as to whether there is a requirement for reversal of input credit of taxes paid on expenses attributable to such non-taxable income.

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Source: Financial Express
Over 1.7 lakh E-Way bills Generated On First Day of Rollout

Over 1.7 lakh E-Way bills Generated On First Day of Rollout

E-way Bills
About 1.71 lakh electronic invoices ( E-Way Bills) were generated on the first day of the implementation of the e-way bill mechanism which is aimed at plugging loopholes and boosting government revenue.

About 10.97 lakh taxpayers have registered on the e-way bill portal — developed by National Informatics Centre — till date, the finance ministry said in a statement.

Starting today, all inter-state movement of goods worth Rs 50,000 will need generation of e-way bills, the GST Council had decided in its 26th meeting last month. The Council had earlier decided to roll out the mechanism from Feb. 1, but the decision was deferred due to technological glitches.

Also read: GST E-Way Bill – key pointers that you need to know

There were no major hiccups on the first day of the relaunch of the e-way bill mechanism, Abhishek Jain, patner at EY India said in a emailed statement. “The e-way bill portal seems to be much stable this time. However, it would be important to watch how the portal functions for few more days to be absolutely sure.”

To answer queries of taxpayers and transporters, the Central helpdesk of GST has made arrangements with 100 agents dedicated to answer queries related to e-way bills, the finance ministry statement added.

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Source :  BloombergQuint
India market is coming back post GST: PepsiCo CEO Indra Nooyi

India market is coming back post GST: PepsiCo CEO Indra Nooyi

The New York-headquartered firm has witnessed organic revenue growth of 7 percent outside North America during the quarter, which was fuelled by continued strong performance in developing and emerging markets.

PepsiCo’s-CEO-Indra Nooyi

Global beverage major PepsiCo is seeing demand coming back in the Indian market post GST and the company has registered “very solid mid-single-digit growth” in the October-December quarter, its Chairman and CEO Indra Nooyi said.

The beverages major would also continue to franchise its bottling operation to its local partners in countries including India, as per its strategy, Nooyi said in a post-earnings concall.

“Post the GST, we are seeing the India market coming back,” Indra Nooyi said.

The New York-headquartered firm has witnessed organic revenue growth of 7 percent outside North America during the quarter, which was fuelled by continued strong performance in developing and emerging markets.

This was “led by double-digit growth in Vietnam, Turkey, Thailand, Philippines and Argentina; high single-digit growth in Russia and China; and very solid mid-single-digit growth in Mexico and India,” said Nooyi.

On being asked about franchising of its bottling operation globally to its partners such as Varun Beverages in India, she said:”I think internationally, when we find a very good bottler and we believe that they can run the business better than us, we will refranchise the business.” The company also said that it gained from an asset sale in India and refranchising in Jordan, which comes under its Asia, Middle East and North Africa (AMENA) division.

“Positively impacted by the Jordan refranchising gain, productivity gains and a gain on an asset sale in India,” the company said in its earnings press statement.

Source :  Money Control

Here’s how much the govt panel recommends lowering of GST rates for SMEs

Here’s how much the govt panel recommends lowering of GST rates for SMEs

Here's how much the govt panel recommends lowering of GST rates for SMEs
There may be some good news for small and medium businesses as a ministerial panel has recommended the lowering of the goods and service tax (GST) rates for them. It is also looking to extend the benefits to more such units in an attempt to reduce their tax burden and improve compliance.

The GST Council will be meeting on November 9-10 and could accept the changes in order to provide relief to small enterprises, eateries and traders.

The ministerial panel proposes a 1% GST for traders, manufacturers and restaurants, instead of the 1%, 2% and 5%, respectively, according to a Live Mint report.

The panel further recommended the increasing the ceiling for eligibility to enterprises with an annual revenue of less than Rs 1.5 crore from Rs 1 crore earlier.

Also Read: GST Council may fix single tax rate for similar product categories

The GST Council had on October 6 took the decision to increase the current ceiling from Rs 75 lakh to Rs 1 lakh. It also extended the deadline for the signing up for the scheme to March 31, 2018.

The ministerial panel which made these recommendations include Assam finance minister Himanta Biswa Sarma, Bihar deputy chief minister Sushil Modi, Jammu and Kashmir finance minister Haseeb Drabu, Punjab finance minister Manpreet Singh Badal and Chhattisgarh minister of commercial taxes Amar Agarwal.

The panel has in its earlier meeting this month had proposed that there be no distinction between air-conditioned and non-air conditioned restaurants and that they should be taxed at 12% as against 18% now.

The report further quoted a GST Council official saying that the ministerial panel has recommended the GST Council let small traders pay either 1% on their revenue of taxable items such as loose rise, pulses, etc, are exempt from GST or 0.5% tax on the total turnover.

Also Read: Glitches in GSTR2 filing process a concern for cash flows

Sharma said that on the allowing of enterprises in the composition scheme to avail of input tax credits on business transactions, the panel could not reach a consensus and the matter will be referred back to the GST Council.

This lowering of GST rates comes after the government has come under severe criticism for the burden facing small business and traders over the implementation of goods & service tax and bringing more businesses under the tax bracket.

Source : Zee Business
Too early to see benefits of GST; expect market to bounce back between Q3 & Q4:TeamLease

Too early to see benefits of GST; expect market to bounce back between Q3 & Q4:TeamLease

TeamLease Services is on the radar after a 10 percent upmove this month and a 90 percent rally this year. In an interview to CNBC-TV18, N Ravi Vishwanath, CFO of TeamLease Services spoke about the latest happenings in his company and sector.

Team Lease : GST news

TeamLease Services is on the radar after a 10 percent upmove this month and a 90 percent rally this year.

In an interview to CNBC-TV18, N Ravi Vishwanath, CFO of TeamLease Services spoke about the latest happenings in his company and sector.

Over the next five years, we should definitely look at the compounded annual growth rate (CAGR) of 20-25 percent, he said.


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The government has taken a lot of initiatives to convert the informal to formal to the more organised sector, that is where the opportunity lies for players like us. The growth of 22 percent should be achievable for us, he added.

Witnessed soft demand in July and August. We will have a clearer picture of how September looks, we do believe that the market should bounce back between Q3 and Q4, said Vishwanath.

It is too early for us to see the benefits of goods and services tax (GST). It is very early stages. It will take at least about three-four quarters for the benefits to start kicking-in, he further mentioned.

Fast moving consumer goods (FMCG), retail and e-commerce is where the uptick has been fairly significant, Vishwanath said.

Seeing a lot more opportunities in the IT companies, he added.


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Source: http://www.moneycontrol.com/news/business/companies/too-early-to-see-benefits-of-gst-expect-market-to-bounce-back-between-q3-q4teamlease-2403591.html
Govt notifies e-way bill for transporting goods under GST regime, exempts some items

Govt notifies e-way bill for transporting goods under GST regime, exempts some items

gst_cgst_igst_utgst

The government notified the e-way bill on Thursday, exempting certain items of mass consumptions including vegetables, fruits, food grains, meat, bread, curd, books and jewellery, reported Economic Times.

Other items that are outside the ambit of the e-way bill includes contraceptives, judicial and non-judicial stamp paper, newspapers, khadi, raw silk, Indian flag, human hair, kajal, earthen pots, cheques, municipal waste, puja samagri, LPG, kerosene, heating aids and currency.

The generation of e-way bill will also not be required in two of the following cases, reported the paper. One, if the goods are transported by a non-motorised conveyance. And two, if the goods are being transported from a port, airport, air cargo complex and land customs station to an inland container depot or a container freight station for clearance by customs.

An e-way bill is required even if goods are transferred from one vehicle to the other. And, for multiple consignments, transporters need to generate a consolidated e-way bill.

The date from which the e-way bill, which will remove check-posts at state borders, would come into effect is yet to be notified. However, sources in the GST Council had earlier told Moneycontrol that the e-way bill rules will likely become effective from October 1.


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Depending on the distance covered or needed to transport the goods, the e-way bill number (EBN) will remain valid for one to 15 days — one day for distances up to 100-km and 15 days for distances of more than 1,000 km.

E-way bill concerns the ferrying of goods worth more than Rs 50,000 within or outside a state under the GST regime, whereby, transportation of goods will require securing an 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 GSTN portal, after which a unique EBN will be made available to the supplier, the recipient and the transporter on the common portal.

According to the report, the e-way bill can be generated as well as cancelled via SMS.

The GST Council had earlier rationalised rates of 19 services including textile jobs and government work contracts, cut taxes on certain tractor parts to 18 percent from 28 percent.

“While these rules will ensure that a common form is applicable across India, the industry has highlighted various issues on the e-way bill provisions that they are concerned about. There should be wider debate and consultation with the industry before implementation of these rules, else the supply chain bottlenecks and operational challenges may far outweigh the perceived benefit this system has to offer,” said Pratik Jain, indirect tax leader, PwC told the newspaper.


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Source :  MoneyControl
How software technology can be leveraged to deliver sustainable GST solutions

How software technology can be leveraged to deliver sustainable GST solutions

GST Solution

The Goods and Services tax (GST) was rolled out by the Government of India on July 1 and ever since, it’s compliance has become a debatable topic for the corporates of all sizes.

The switchover to this new tax regime, along with its compliance, thereafter have been particularly under the microscope, rushing businesses to take support from technology and tax software providers.

With expertise in their field of work, software companies have already started rolling out GST specific products. The offered tools are being put in action by the firms for better conformity of the newly amended tax regime.

On the corporate front, companies are facing a problem of rapid reaction to GST but their lack of knowledge and experience is making it a tedious task for them, to make a choice of which among the many to exercise, resulting in chaos and confusion within uninitiated firms. Many may not even be acquainted with what tax-solution providing software can do.

These software products are complete business management software and help a company keep track of all departments and maintains an account of everything in the business.

XaTTaX GST Software

Here are some tips by Pavan Peechara, director at Udyog Software on how software technology can be leveraged to deliver sustainable GST solutions.

1. HSN look up an interesting feature:

A tool to provide a sustainable GST solution must possesses the HSN look up feature. Such feature allows you to search products with HSN code through HSN lookup which further helps in easy identification and categorizing of companies and their goods or services.

2. Cost Effectiveness for better Efficiency:

Like most of the software, GST software should facilitate cost effectiveness by providing the users with an affordable cost quotation which furthermore takes care of the overall cost effectiveness of rolling out and meeting compliances.

3. Easy billing through automated filing:

Software providing the HSN look up makes it easy to calculate tax category and percentage of it that has to be levied automatically. Features like this make it easy to process billing and minimizing human errors.

4. User-friendly software ensures optimum adaptation:

One of the most important aspects of employing software in a business is the level of user friendliness it offers its simplified operations. It results in quick learning and operational ease. Therefore software must be user-friendly for easy adaptation.

5. Filling complicated tax forms in one click:

Automation features should be provided by these software. It eliminates the hassle of paperwork and filing as it is taken care of by direct uploading of tax filing formalities online itself.

6. Innovation and technology as major facilitators:

Technology has always been a sector where innovation is its bread and butter to remaining on the top as most preferable. Technology goes through tremendous R&D to outpace the outdating. A firm must be aware to adapt to the software that best meets the corporate requirements and itself. In short, it should be future proofed to meet new tax slab incorporation or changing of slabs.

7. Accessibility of Location increases efficiency:

The most important feature of such software should be the ability to work beyond your 9 to 5 premises to access the required data. It should have the ability to be operated from anywhere and at any time to ensure effectiveness as efficiently online as it should do offline.

8. Customer support as an integral part of the process:

Due to the conundrum created around the GST system, it is of utmost importance for the software agencies to be readily available to handle all queries put up by its users in order to maintain a strong and impactful relationship.

Before selecting a GST compliance solution – use this time to take stock of your business and its operations:

How many branches and locations do you have?

Are you clear on the tax treatments for what you sell and buy?

Do you understand what returns you will file?

Are you able to generate a tax invoice each and every time with the correct rates applied?

As you go through this analysis work with your CA or seek out a CA to make sure this moves smoothly.

Custom made solutions – this is a phrase that brings up the thought of a string and twines software, which isn’t tested, supported and has to be managed through an expensive contract. People want solutions which work “out of the box.


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Source: Business Standard

GST brings macro-economic stability: FM Arun Jaitley

GST brings macro-economic stability: FM Arun Jaitley

GST : Arun jaitley

The Financial Stability & Development Council (FSDC) has promised to keep a “constant vigil” and be in a state of “preparedness” to manage any external and internal vulnerability that may affect the economy.

Besides discussing the challenges faced by the economy, the FSDC, chaired by Finance Minister Arun Jaitley, which met on Tuesday, noted that the country today enjoyed “macro-economic stability” on the back of an improvement in its macro-economic fundamentals and structural reforms with the launch of the Goods and Services Tax (GST).

Action being taken to address the twin balance sheet (TBS) challenge, extraordinary financial market confidence reflected in bonds and especially stock valuations and long-term positive consequences of demonetization have also bolstered the macro-economic situation, the FSDC said.


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

But India’s progress to a higher growth trajectory of, say, 8-9 per cent looks difficult given the predominance of the twin balance sheet problem manifested in the form of a leveraged corporate sector and stressed banking sector, according to economy watchers.

The FSDC took note of the progress of the Financial Sector Assessment Program for India jointly conducted by the International Monetary Fund and the World Bank. It has directed that the assessment report should be finalised by the end of this calendar year.

The FSDC took note of the developments and progress made in the setting up of a Computer Emergency Response Team in the Financial Sector (CERT-Fin) and a Financial Data Management Centre and discussed measures for the time-bound implementation of the institution-building initiative. A brief report on the activities undertaken by the FSDC Sub-Committee Chaired by the RBI Governor was placed before FSDC. The council also undertook a comprehensive review of the action taken by members on the decisions taken in earlier meetings.

The council discussed the Central KYC Registry (CKYCR) system, took note of the initiatives taken in this regard by the members and discussed the issues/suggestions in respect of operationalization of CKYCR. It also deliberated on strengthening the regulation of the credit rating agencies.

The FSDC comprises Urjit R. Patel, Governor, Reserve Bank of India; Ashok Lavasa, Finance Secretary; Subhash Chandra Garg, Secretary, Department of Economic Affairs; Anjuly Chib Duggal, Secretary, Department of Financial Services; Tapan Ray, Secretary, Ministry of Corporate Affairs; Ajay Prakash Sawhney, Secretary, Ministry of Electronics and Information Technology; Arvind Subramanian, Chief Economic Adviser; Ajay Tyagi, Chairman, SEBI; TS Vijayan, Chairman, IRDAI; Hemant G Contractor, Chairman, PFRDA.


Use XaTTaX to file GSTR 3B Returns for free

Source :  The Hindu Business Line
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