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GST: Evasion, returns and revenue boosting measures to feature at officers’ meet Monday

GST: Evasion, returns and revenue boosting measures to feature at officers’ meet Monday

Tax officers from the states and the Centre will get together for a day-long meeting on Monday to discuss administrative, legal, revenue and implementation-related issues under the indirect tax regime.

This will mark a first of its kind interaction between central and state tax officers, delinked from the agenda of the Goods and Services Tax (GST) Council meeting. Usually, officer-level meetings have always taken place a day before the GST Council meetings, mainly to discuss measures outlined in the Council’s meeting agenda.

As slowing revenues under the GST have become a concern, officials from the states and the Centre will discuss measures for anti-evasion, revenue augmentation, compliance, returns filing and online system, officials said. The rates of goods and services will, however, not be discussed since those pertain to the GST Council, they said.

Officials said this meeting would be more broad-based, wherein states and the Centre would have a common platform to discuss measures to streamline and regularise many pending issues under the GST. The tax officials are expected to take up issues related to e-way bills, delay in filing returns, IT matters, pending legislative changes, and methods to ensure greater coordination between states and Centre under GST, they said.

“This method to have a common platform for discussion between states and Centre is being tried for the first time. The idea was not to club it with a GST Council meeting and have an open agenda meeting. This was felt necessary so as to develop a mechanism for similar discussions going ahead. The officer-level meetings before Council meetings, otherwise, have too many agenda items and not everything gets discussed in detail,” one of the officials said.

Apart from the administrative- and implementation-related issues, pending legal changes would also be discussed. Another official said many states have not followed up on the amendments in the Central GST (CGST) Act with changes in their respective State GST (SGST) Acts, so much so that in some places there is a time lag of six months. “Such issues need to be prioritised since they are creating a hurdle in proper implementation of GST and would be raised in the meeting,” the official said.

The plan to hold this meeting comes even though the Council last month constituted a committee of officials from states and the Centre for revenue augmentation and looking into wider range of reforms such as systemic changes in the GST, including checks and balances to prevent misuse, measures to improve voluntary compliance, improved compliance monitoring and anti-evasion measures. The committee, which was earlier supposed to submit its report within 15 days, has so far met only once and is now likely to be given an extension of 1-2 months, officials said.”The committee has a wide range of topics in its terms of reference, so it would take time,” an official said.

GST collections in October contracted by 5.29 per cent to Rs 95,380 crore from Rs 1,00,710 crore in the year-ago month, marking the third instance of a contraction since the July 2017 roll-out of the indirect tax regime.

Source: indian-Express

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GST collections remain subdued at Rs 95,380 crore in October

GST collections remain subdued at Rs 95,380 crore in October

The Goods and Services Tax (GST) collection in October declined to Rs 95,380 crore, as against Rs 1,00,710 crore in the same month a year ago, as per government data released on Friday.

This is the third consecutive month when GST mop-up remained below the Rs 1 lakh crore mark, despite October being a festive month.

The revenue collection in September stood at Rs 91,916 crore.

“The gross GST revenue collected in the month of October, 2019 is Rs 95,380 crore of which CGST is Rs 17,582 crore, SGST is Rs 23,674 crore, IGST is Rs 46,517 crore (including Rs 21,446 crore collected on imports) and Cess is Rs 7,607 crore (including Rs 774 crore collected on imports),” the finance ministry said in a statement.

It further said the total number of GSTR 3B returns (summary of self-assessed return) filed for the month of September (up to October 30) was 73.83 lakh.

Source: Times-Of-India.

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18% GST applicable to Works Contract of Residential Quarters, rules AAR

18% GST applicable to Works Contract of Residential Quarters, rules AAR

The Authority of Advance Ruling ( AAR ) in Madhya Pradesh has ruled that, 18% Goods and Services Tax ( GST ) applicable to Works Contract of Residential Quarters.

The AAR has clarified the rate of GST on contract for Construction of building and structure for colony a village Siveria at 2 x 660 MW Shree Singaji Thermal Power Project Stage – II Khandwa.

The AAR observed that the issue before us is squarely covered under Section 97(2)(a) of the Act and therefore we admit the application for consideration.

The authority vide order dtd.18.10.2018 had ruled that “The works contract service of construction of 599 residential quarters allotted to the applicant (Shreeji Infrastructure P.Ltd.) by MPPGCL will merit classification under SAC 9954 and would attract GST @18% (9%CGST + 9%SGST)”.

Construction of residential quarters, though within the precincts of Power Plant’ cannot by any stretch of argument and imagination be termed as the work entrusted to the applicant.

The AAR also observed that, the GST will be applicable @18% under SAC 9954, in as much as it refers to the construction of residential quarters, which was awarded to M/s.Shreeji Infrastructure P.Ltd., as already ruled vide our order no.15/2018 dtd.18.10.2018.

Source: TaxScan.

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GST Council Sets Up Panel To Boost Revenue Collection

GST Council Sets Up Panel To Boost Revenue Collection

The GST Council on Thursday constituted a committee of officers to improve revenue after the collections dropped to a 19-month low of Rs. 91,916 crore in September reflecting weak consumer demand. The second straight month of decline in the GST collections came amid a massive slowdown in the economy, visible in six year low GDP growth numbers for the April-June quarter.
“The committee shall submit its first report within 15 days to the GST Council Secretariat which shall coordinate the meeting of the committee to ensure finalisation of the inception report..,” the GST Council office memo said.

The GST Council, in a memorandum, said that that it has been decided that that a committee of officers from state as well as the Centre is “required to suggest steps to be taken to improve revenue collection”.

The Council expects the newly formed committee to look into “policy measures and changes in the law”, measures to “improve voluntary compliance and improved compliance monitoring and anti-evasion measures” among others.

The aim is to move to GST 2.0 and leapfrog tax reform to its second phase by bringing electricity, oil & gas, real estate and alcohol under its ambit and converging the rate structure into two-three slabs.

The members of the committee, as stated, were the Commissioners, SGST of Maharastra, Tamil Nadu, Uttar Pradesh, West Bengal and Punjab.

The members from the Centre would include Principal Commissioner, GST PW, Joint Secretary (TRU 1 and 2), ADG (ARM and Systems) and Joint Secretary, Revenue.

Besides, the Joint Secretary, GST Council Secretariat and Executive VP, GSTN will also be the part of the committee.

Source: NDTV-Profit.

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GST collection slips below Rs 1 lakh crore mark to Rs 91,916 crore in September

GST collection slips below Rs 1 lakh crore mark to Rs 91,916 crore in September

In another indicator of economic slowdown, GST collection has dropped below Rs 1 lakh crore mark to Rs 91,916 crore for September. The September collection is believed to be the lowest in nineteen months.

The revenue during September, 2019 has declined by 2.67% in comparison to the revenue during September, 2018. During April-September, 2019 vis-à-vis 2018, the domestic component has grown by 7.82% while the GST on imports has shown negative growth and the total collection has grown by 4.90%

CGST is Rs 16,630 crore and SGST is Rs 22,598 crore. IGST is Rs 45,069 crore (including Rs 22,097 crore collected on imports) and Cess is Rs 7,620 crore (including Rs 728 crore collected on imports). The total number of GSTR 3B Returns filed for the month of August up to 30th September, 2019 is 75.94lakh.

The government needs over Rs 1 lakh crore GST in order to meet its fiscal target and also to not compensate states for losses. It compensates states once in every two months for the losses they incur in the first five years of the implementation of GST.

The government has already transferred Rs 27,955 crore to the states in the form of compensation in June-July this year and Rs 17,789 crore in April-May.

Source: Economic-Times

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GST Network starts online refund processing

GST Network starts online refund processing

GST Network, the IT backbone of the indirect tax system, on Thursday unveiled an online refund process as decided by the GST Council.

With the deployment of online refund functionality, taxpayers can now file refund application (in RFD 01 form) easily and tax officers can process the same online, GST Network said in a statement.

All communications between taxpayers and tax officers will also be online. The online refund process has become effective from September 25, 2019, on the GST portal, it said.

Earlier, the refund processing was done for both Central and State GST by one tax authority to whom the taxpayer was assigned administratively but disbursement was done by accounting authorities of central and state tax departments separately.

This was leading to a delay on account of sharing of sanction order with counterparty accounting authority through that tax authority, it said.

The new system has done away with this and after processing is completed by the tax officer, the sanctioned amount will get credited to the bank account of the Taxpayer through PFMS System, it said.

GST Network CEO Prakash Kumar said the new refund process will create a seamless experience for both taxpayers and tax officers.

“This will boost the disbursement speed of refunds and further improve the GST compliance. Taxpayers can view the various stages of processing of their refund application on the GST Portal and can give replies to notice, if any, online on the GST Portal now,” he said.

They will also be given information via SMS and Email, at important stages of processing of their refund application, he said, adding most importantly, the payment of amount will now be done from one disbursement authority i.e. PFMS unlike the earlier method where sanction was done by one authority but payment was made by State and Central Authorities separately.

Meanwhile, all refund applications filed before September 26, 2019 will be processed manually as done under the old refund process.

Source: Live-Mint.

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GST: Restrictions on ITC claim if you do not file GSTR 1 on time

GST: Restrictions on ITC claim if you do not file GSTR 1 on time

The GST Council, in its 37th meeting held at Goa, has come up with various proposals to simplify and strengthen the tax filing system and one such decision is aimed at ensuring taxpayers file their GSTR 1 in time.

“In order to nudge taxpayers to timely file their statement of outward supplies, imposition of restrictions on availment of input tax credit by the recipients in cases where details of outward supplies are not furnished by the suppliers in the statement under section 37 of the CGST Act, 2017,” a statement said. This means when taxpayers do not file a GSTR 1, they would not be able to claim input tax credit.

According to Archit Gupta, Founder and CEO – ClearTax, there will be restrictions on ITC claim for those who fail to submit GSTR-1. “ITC will only be allowed to be claimed where outward supplies have been reported by your suppliers. This is an important step to ensure validity of ITC claim in the system and sets the stage for the new simplified return filing mechanism. Those whose suppliers do not submit GSTR-1 will be restricted from availing ITC credit,” says Gupta.

Incidentally the Government on Friday said, the New return system that was to be introduced in October 2019, would now be introduced from April, 2020. This is in order to give ample opportunity to taxpayers as well as the system to adapt and accordingly specifying the due date for furnishing of return in FORM GSTR-3B and details of outward supplies in FORM GSTR-1 for the period October, 2019 – March, 2020.

“With the Government now showing full intention to plug ITC leakages, businesses cannot do without a robust mechanism that will keep suppliers in check and make sure they are complying in a timely manner,” says Gupta.

Other announcements:

The GST Council provided much-needed relief to MSMEs by allowing them waiver to file GSTR 9 and GSTR-9A. Announcing the relaxation in filing of annual returns for MSMEs for FY 2017-18 and FY 2018-19, a statement said waiver of the requirement of filing FORM GSTR-9A for Composition Taxpayers for the said tax periods will be provided.

Additionally, filing of FORM GSTR-9 for those taxpayers who (are required to file the said return but) have aggregate turnover up to Rs. 2 crore made optional for the said tax periods.

Other important decision taken at the Council meeting include setting a Committee of Officers to examine the simplification of Forms for Annual Return and reconciliation statement and extension of last date for filing of appeals against orders of Appellate Authority before the GST Appellate Tribunal as the Appellate Tribunals are yet not functional.

Source: Economic-Times.

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Bring GSTR with invoice matching for all by January: Bengal FM

Bring GSTR with invoice matching for all by January: Bengal FM

West Bengal finance minister Amit Mitra has sought a probe into rampant goods and services tax evasion. In a letter to finance minister Nirmala Sitharaman, dated August 27, Mitra also sought the introduction of the new return system with invoice matching by October for large taxpayers and by January, 2020, for all tax payers.

Mitra further wrote that he had forewarned that giving up invoice matching would lead to widespread tax frauds and hawala transactions.

Citing the Minister of State for Finance Anurag Thakur’s response in Rajya Sabha, Mitra said that the fraud worth Rs 45,682 crore was not only alarming, but also understated. The figure did not include SGST frauds, and should they be included, the figure would cross Rs 1lakh crore, Mitra claimed.

“At the time of GST introduction, neither the statutory forms including GST Return were ready, nor the IT system was tested,” he said. The widespread tax fraud took place due to lack of veracity of claimed GST via input tax credit, Mitra said.

Source: Economic-Times

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No GST on everyday items like milk and meat

No GST on everyday items like milk and meat

Bollywood actor Rahul Bose tweeted how a Chandigarh-based five-star hotel billed him a staggering ₹442, including GST (goods and services tax), for just two bananas. The GST amount was ₹67.50—a 9% central GST of ₹33.75 and a 9% Union Territory GST of ₹33.75. The news seem to have fizzled out, but as a consumer, it’s important to know what’s the right GST amount you need to pay, and which items are exempt from GST altogether. Here are a few everyday items, across three categories, on which you don’t need to pay GST.

Food items: There is no GST on fresh or pasteurized milk, butter milk, curd, chena or paneer, and non-vegetarian items like eggs, chicken, fresh meat, and fresh or chilled fish. Fruits, vegetables, as well as unit container-packed frozen branded vegetables (uncooked or steamed) are also exempt.

Other items on this list include natural honey, hulled cereal grains like barley, wheat, oat and so on. Palmyra jaggery, all types of salt, flours like gram or pea flour, coconut, fresh or dried, whether or not shelled or peeled, all kinds of whole spices like seeds of anise, fennel, coriander, cumin or caraway, are exempt. Even items like papad, except when served for consumption, bread (branded or otherwise), and pizza bread are exempt. Water (other than aerated, mineral, purified, distilled, medicinal, ionic, battery, de-mineralized and water sold in sealed containers) have no GST.

Personal items: Several personal items too feature on the zero GST list. For instance, sanitary pads, kajal (other than kajal pencil sticks), glass and plastic bangles, hearing aids, slates, pencils, chalk sticks, passenger bags, bindi, and all types of contraceptives, including condoms.

Miscellaneous items: These mostly include stationery items and items bought from the government. For instance, picture, colouring and drawing books for children, music books, manuscripts, postal items like envelope and post cards sold by the government, newspapers, journals and periodicals, whether illustrated or containing advertising material. Maps and hydro graphic or similar charts of all kinds, including atlases, wall maps, topographical plans and globes, that are printed are also included. Cheques, loose or in a book form, printed books, including Braille books, judicial and non-judicial stamp papers, court fee stamps when sold by government treasuries or vendors authorized by the government, and rupee notes when sold to the Reserve Bank of India are part of the list.

Religious routine ritual items like rudraksha attract no GST. Even items like earthen pots, clay lamps are not in the GST list. Medical items like blood from blood banks attract no GST either.

Remember that some items may attract zero GST only if they are not packaged.

Source: LiveMint
Written By: Bindisha Sarang

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Poorer states leave industrialised peers behind in GST collection rates: Report

Poorer states leave industrialised peers behind in GST collection rates: Report

Heartland states such as Bihar, Uttar Pradesh, Madhya Pradesh and Odisha showed improved performance in goods and services tax (GST) collection for 2019, as compared to the previous year, reports the Times of India.

Their performance stood out against that of industrialised states, with only West Bengal bucking the trend, the report said.

Delhi, with a 2 per cent drop, reported the worst collection of Rs 12,700 crore for April-July 2019, compared to Rs 13,000 crore a year back, it said, adding that the overall GST collection for the period rose by 9 per cent to Rs 3.56 lakh crore.

The top performers in terms of collection rates were Nagaland (39 per cent), Arunachal Pradesh (35 per cent) and Sikkim (32 per cent). Their GST collection volumes, along with Meghalaya, were between Rs 370 crore and Rs 680 crore, the report said.

Odisha saw collection rate spike by 20 per cent to Rs 9,264 crore for April-July 2019 from Rs 7,666 in April-July 2018, Uttarakhand by 19.9 per cent (Rs 3,676 from Rs 3,067); Bihar by 17.8 per cent (Rs 11,625 – Rs 9,869) and Madhya Pradesh by 14.6 per cent from Rs 14,024 to Rs 12,240.

Assam recorded a 14.1 per cent rise (Rs 6,197 – Rs 5,433), Uttar Pradesh (12 per cent from Rs 34,783 to Rs 31,056), Karnataka 10.7 per cent (Rs 29,789 – Rs 26,908), Tamil Nadu – 10 per cent (Rs 27,959 – Rs 25,425), Andhra Pradesh – 9.1 per cent (Rs 14,482 – Rs 13,271), and Telangana – 8.7 per cent (Rs 16,121 – Rs 14,832).

Maharashtra rose by 7.2 per cent (Rs 54,208 – Rs 50,557), West Bengal 6.4 per cent (Rs 19,014 – Rs 17,862), Gujarat 6.2 per cent (Rs 24,663 – Rs 23,221) and Kerala 4.7 per cent (Rs 14,542 – Rs 13,888).

MS Mani, a partner at consulting firm Deloitte, told the paper that the above-average collections in consuming states were “expected even prior to GST launch as it is structured as a destination-based consumption tax”.

“However, originating states, where the collection growth has been slower, would need to consider the fact that the compensation mechanism comes to an end in 2022, unless extended,” he said.

Anticipating this development, Gujarat, Maharashtra and Tamil Nadu had demanded that the Modi-led government begin negotiations for implementing GST – demands that the BJP-rules states later dropped.

As per stipulations, states with less than 14 per cent annual growth would be compensated by the Centre for five years. However, some of these states – going by the GST numbers – would not require the support, the paper pointed out. The compensation is paid out of cess imposed on soft drinks, tobacco and automobiles among others.

Experts told that paper that the development has been good for poorer states and would augur well for states with high production and consumption base as well, such as Maharashtra.

However, states with lower populations such as Haryana and Punjab could be adversely affected as the various taxes subsumed into GST would affect their monies.

Source: Money-Control.

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Source: Live-Mint

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