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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.

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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.

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Select states not in favour of GST rate cut for auto, fear revenue loss

Select states not in favour of GST rate cut for auto, fear revenue loss

The automobile sector, which is already undergoing one of its worst phases, may further take a hit amid reports that several states including West Bengal, Bihar, Punjab and Kerala are against the GST rate cut.

An ET Now report said that these states believe high taxation is not a reason behind the crisis in the auto sector. “States claimed that GST is not behind the slump,” ETNow said.

These states are afraid of the loss of revenue in case GST rates are slashed. “Reducing the 28 per cent tax category will cut compensation cess kitty,” the report added.

The report further said that states may take up weak revenue position in the upcoming GST meet. The council may also take up the issue of GST revenue leakages.

The report comes days before the GST Council is scheduled to convene on September 20 when, among other things, it is expected to take a call on the industry’s demand for a cut in goods and service tax on automobiles.

The Centre may be forced to dip into its Consolidated Fund of India, ETNow reported quoting sources. “Centre to dip into the fund to meet 14 per cent revenue commitment to states,” it said.

Earlier, Bajaj Auto managing director Rajiv Bajaj in an earlier with ET also said that the current crisis in the automobile industry in the country is largely due to “overproduction and stocking” by companies and to a small extent to the economic slowdown, and there’s no need for a GST cut.

“There’s no industry that keeps growing forever without correction, so no point chasing that mirage,” Bajaj said in an interaction with ET. “The answer lies in being global so that the company doesn’t fall sick if one market catches flu.”

Source: Economic-Times.

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Firms with annual income upto Rs 2 crore could get GST return relief

Firms with annual income upto Rs 2 crore could get GST return relief

The all-powerful GST Council is set to discuss a proposal to exempt small businesses with annual turnover of less than Rs 2 crore from filing annual returns.

Senior officials said that despite three extensions for filing the returns, the number has been unsatisfactory. “It is ranging from 25-27 per cent despite extension of deadlines. The GST Council will discuss the issue in its meeting on September 20,” said an official.

He further said that the Council will decide if the mandatory return filing requirement be suspended for only 2017-18 or for subsequent financial years as well.

“There is also a view that government should wait till November 30 to see if the number of those filing returns goes up,” he said adding there would be many procedural issues that would be considered by the Council this time. As per official data, out of about 1.39 crore total assessees, nearly 85 per cent have an annual turnover of Rs 2 crore or less.

Tax experts said that the proposed move to dispense small taxpayers from filing annual returns would ease compliance burden and also help tax authorities focus on big assessees. “There is perhaps a need for rethinking. There is a view that why put more compliance burden on small taxpayers. The system is also not very robust,” said Amit Bhagat, Partner, indirect tax practice, Dhruva Advisors. At present, every GST assessee has to file an annual return in GSTR 9 forms.

MS Mani, Partner with Deloitte India said that during implementation of GST, most small traders and businesses had found it difficult to shift to GST and any relief to them would be a big help for the micro, small and medium enterprises (MSME) sector. “If there is a compliance relief given to them for a year or two it will make GST much more acceptable for the MSME sector,” Mani noted.

Source: Economic-Times

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No GST if maintenance paid to housing society is less than Rs 7,500 every month

No GST if maintenance paid to housing society is less than Rs 7,500 every month

The GST exemption on maintenance charges paid to a housing society by a member is available only if it doesn’t exceed Rs 7,500 per month, the Authority for Advance Rulings (Tamil Nadu) has ruled. If the charges exceed the sum, the entire amount is taxable.

In its order, the AAR bench provides a numerical illustration. If the maintenance charges are Rs 9,000 per month per member, GST shall be payable on the entire amount of Rs 9,000 at the rate of 18%. It shall not be payable on the differential of Rs 1,500 (Rs 9,000 minus Rs 7,500). The ruling has been recently made public and is in sync with a clarification issued (after the order) by the finance ministry on July 22.

Further, tax experts point out that if the annual collection of a housing society is less than Rs 20 lakh, it does not have to register for GST. Thus, it will not have to collect and pay GST even if the monthly amount of maintenance charges exceeds Rs 7,500 per month per member. It should also be noted that prior to January 25, 2018, the exemption limit was lower at Rs 5,000 per month.

Maintenance charges are collected by a housing society for various purposes like providing security, lift maintenance, maintenance of common areas like a lobby, garden, club house, swimming pool, to name a few instances. These charges are typically a reimbursement for expenses incurred by the housing society against payments made to third parties.

In this case before the AAR, a Chennai housing society – TVH Lumbini Square Owners Association – contended that if individual contributions towards maintenance exceeds Rs 7,500 per month, GST is liable to be paid on the differential, which is only on charges over and above this sum. The AAR ruled otherwise.

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Source: Times-of-India
‘GST return form too complex to meet filing deadline’

‘GST return form too complex to meet filing deadline’

Although the government has postponed the deadline for the filing of annual returns under the Goods and Services Tax (GST) for the fourth time, tax analysts say that the problems with the form are so confounding that most filers won’t be able to meet even the new deadline of November 30.

The GST legislation requires the filing of the GST annual returns by specified categories of taxpayers along with a GST audit if the turnover is more than ₹2 crore in a financial year.

As of July 1, 2019, the third year of GST implementation had started and yet, tax filers had not been able to file the returns even for the first year. The government had extended the due date for filing the returns four times, with the latest being the extension from August 31 to November 30.

One of the biggest pain points for tax filers, according to the analysts, is that the annual return form — the GSTR-9 — asks for a lot of information. Such information was not required to be given in the monthly or quarterly return forms — GSTR-1 and GSTR-3B. Tax filers are thus finding it very difficult to provide that information.

“GSTR-9 is nothing but complexity and confusion galore,” said Ritesh Kanodia, partner, Dhruva Advisors.

“The complexity starts with the level of details required, despite the fact that most of these were waived for monthly return filing. For example, the break-up of credit into input, input services and capital goods, or the break-up of reversals type-wise, reporting of ineligible credit, which may not have been captured in the financials.

“The values derived from the system does not always match with the books and a lot of time is wasted in trying to match them, with the only conclusion that it cannot be done,” Mr. Kanodia added.

Apart from the discrepancies between the data in the various GST forms that have to be submitted, another major issue being faced is the complexity of the annual return filing itself, and the fact that it requires information that is often at odds with the GST law itself.

“The manner in which the said information is to be provided is quite complicated,” said Prashanth Agarwal, partner, indirect tax, PwC India. “Although some of the aspects have been clarified by the government on this, still there are open issues which need clarity.

“There is a need to provide HSN classification for services at a six-digit level whereas the GST law allows companies to maintain the same at a four-digit level as well,” Mr. Agarwal added.

“Hence, companies don’t have this six-digit classification available with them. The government should allow companies to report HSN at the four-digit level.”

Onerous requirement
In what is being seen as an extremely onerous requirement, the annual return also requires tax filers to provide details of the transactions on which GST is not payable. Further, in terms of discrepancies, the power lies with the government. Companies cannot claim more input tax credit (ITC) than had already been claimed in the year, but the government can ask for more tax if it feels it is needed.

“The annual return requires the details of all those transactions in respect of which no GST is payable during the relevant period, which make the entire process more complex,” Rahul Dhuparh, deputy general manager, Taxmann said.

“No additional ITC can be claimed in GSTR-9, though additional tax, if found to be payable while reconciling, must be deposited with the government in cash.

“Due to the complex structure of the annual return, taxpayers are afraid to file it as there is no provision in the law to rectify the annual returns,” he added.

“Small taxpayers, who run their business from multiple registrations, but do not maintain separate books of accounts and do not have information split according to GSTIN registrations, are facing a huge challenge in preparing GSTR-9,” said Archit Gupta, founder and CEO, Cleartax.

“Taxpayers with a turnover of less than ₹5 crore must be allowed to report GSTR-9 on an aggregate basis, instead of GSTIN-wise,” said Mr. Gupta.

Source: The-Hindu.

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Traders want GST norms to be further simplified 

Traders want GST norms to be further simplified 

Shortly after the Union finance minister Nirmala Seetharaman announced measures to help businessmen combat recession, city-based traders are demanding more benefits.

They are of the view that the norms governing the GST should be further eased and the government should take steps like making tax payments under the GST on quarterly basis for small industrialists.
Recently, the tractor parts manufacturers and traders association (TPMA), Ludhiana, organized a meeting with Pawan Garg, deputy excise and taxation commissioner (DETC), Ludhiana, and expressed their concerns.

Vijay Dadu, president, TPMA, said: “We are thankful to the Union government for understanding the situation of businessmen and taking steps in the right direction to revive the economy. But as far as small industries are concerned, there is still a scope of taking more steps which can give them a breather like simplifying the taxation system, particularly the GST, and depositing tax on quarterly basis for small industries.”

Dadu said: “We have had a cordial meeting with Pawan Garg and apprised him about all the problems being faced by the businessmen and which should be addressed at the earliest. If the taxation system is made more easy and simplified then the businesses will bloom. This will not only benefit the businessmen, but the government too since the revenue will also rise.”

Anoop Saggar, chairman of the TPMA, said: “The recession in India is getting more serious day by day and the situation is becoming more challenging for us. At this hour of distress, it is only the government from where we have hopes. The government should consider reducing the rate of interest on loans to small businesses. Even a small step like this can bring a lot of change. At the same time, businessmen should also try and adopt modern techniques which can help them in cutting down the labour and production cost.”

Meanwhile, the TPMA also conducted its annual general meeting on Sunday where the present committee presented details of the works done under their tenure.

Source: Times-of-India.

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Last date to file GST annual returns extended till 30 November

Last date to file GST annual returns extended till 30 November

The finance ministry on Monday said the last date for filing annual GST returns has been extended by three months to November 30 as taxpayers were facing technical problems in furnishing returns.

Earlier, GST taxpayers were to file required returns by August 31.

“It is hereby informed that the last date for furnishing of annual return in the Form GSTR-9 / Form GSTR-9A and reconciliation statement in the Form GSTR-9C for the financial year 2017-18 is extended from August 31, 2019 to November 30, 2019,” the Central Board of Indirect Taxes & Customs (CBIC) said in a statement.

GSTR 9 is an annual return to be filed yearly by taxpayers registered under the Goods and Services Tax (GST). It consists of details regarding the outward and inward supplies made or received under different tax heads.

While extending the date, the CBIC said “certain technical problems are being faced” by the taxpayers as a result annual return for the period July 1, 2017 to March 31, 2018 could not be furnished by persons registered under GST.

GSTR-9C is filed by those whose annual turnover exceeds ₹2 crore. It is a statement of reconciliation between GSTR-9 and the audited annual financial statement, while GSTR-9A is the annual return to be filed those who have opted for the Composition Scheme under GST.

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Source: Live-Mint.
CAIT seeks extension of last date to file GST annual return to October 31

CAIT seeks extension of last date to file GST annual return to October 31

Traders’ body CAIT on Thursday asked the finance ministry to extend the last date for filing annual GST return by two months to October 31.

The last date to file the return is August 31. In a letter to Finance Minister Nirmala Sitharaman, the Confederation of All India Traders (CAIT) said prescribed Form GSTR 9 for filing annual return “is still very complicated”.

According to it, several information sought in the Form are new and in spite of best efforts traders are finding it difficult to comply with the same.

CAIT National President B C Bhartia said many a times, the GST portal is not working efficiently preventing the traders from uploading the Form.

Its Secretary General Praveen Khandelwal also cited disruption of internet services in Jammu and Kashmir, and floods in several parts of the country as a reason for extension of deadline for filing the return to October 31.

The CAIT also said the GSTR 9 Form should be simplified to the extent that even an ordinary trader may be able to file the return himself. GSTR 9 is an annual return to be filed yearly by taxpayers registered under GST.

It consists of details regarding the outward and inward supplies made or received under different tax heads.

Source: Money-Control

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GST department yet to implement high court’s order on ITC 

GST department yet to implement high court’s order on ITC 

High court’s order that input tax credit (ITC) accumulated up to July 31, 2018 will not lapse had provided relief to powerloom weavers in Surat, but delay in its implementation by central government and GST department is troubling them.

At present, the man-made fabric (MMF) sector comes under inverted duty structure where duty on raw material or input as well as duty on finished products is higher. For example, man-made fabric manufactured by powerloom weavers attracts Goods and Services Tax (GST) at 5% and that input material, including yarn, attracts duty of 12%. The difference of 7% is to be refunded as input tax credit (ITC).

Central Board of Indirect Taxes (CBIC) had issued a notification saying refund of ITC will be possible from August 2018 and that accumulated ITC from the date of GST notification till July 2018 will lapse. This particular circular was challenged by powerloom weavers, including Federation of Gujarat Weavers’ Association (FOGWA) in the high court.

In the first week of August, the high court quashed the CBIC circular declaring it ultra vires and beyond the scope of section 54(3)(ii) of the CGST Act.

FOGWA president Ashok Jirawala said, “Even after the high court’s order, the GST department is yet to work out distribution of the lapsed ITC credit to powerloom weavers. The release of ITC will pump in fresh investment in the sector.”

Pandesara Weavers’ Association president Ashish Gujarati said, “We are going to meet GST commissioner in a day or two to appeal him to issue trade notice with regards to the high court order.”

Source: Times of India