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CBIC extends due date of GST compliance of E-Way Bill in respect of goods sent/taken on approval for Sale/Return are removed before the Supply takes place

CBIC extends due date of GST compliance of E-Way Bill in respect of goods sent/taken on approval for Sale/Return are removed before the Supply takes place

The Central Board of Indirect Taxes and Customs (CBIC) extended the due date of GST compliance and validity of the e-way bill till October 31, 2020 in respect of goods sent/taken on approval for sale/return are removed before the supply takes place.

The Board seeks to amend notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 35/2020-Central Tax, dated the 3rd April, 2020.

The board seeks to amend clause (i) of the said notification to extend the due date of compliance which falls during the period from the 20th day of March, 2020 to the 29th day of June, to 30th day of June, 2020.

In the said notification, in the first paragraph, in clause (i), after the first proviso, “provided further that where, any time limit for completion or compliance of any action, by any person, has been specified in, or prescribed or notified under sub-section (7) of section 31 of the said Act in respect of goods being sent or taken out of India on approval for sale or return, which falls during the period from the 20th day of March, 2020 to the 30th day of October, 2020, and where completion or compliance of such action has not been made within such time, then, the time limit for completion or compliance of such action, shall stand extended up to the 31st day of October, 2020,” shall be inserted.

The Section 31(7) of the Union Territory Goods and Service Tax Act says, “where the goods being sent or taken on approval for sale or return are removed before the supply takes place, the invoice shall be issued before or at the time of supply or six months from the date of removal, whichever is earlier.”

Source: TaxScan.

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GST reduced tax rates, doubled taxpayer base to 1.24 cr: Finance Ministry

GST reduced tax rates, doubled taxpayer base to 1.24 cr: Finance Ministry

The Finance Ministry on Monday said GST has reduced the rate at which people have to pay tax, helped increase compliance and doubled taxpayer base to 1.24 crore.

In a series of tweets, on the first death anniversary of former Finance Minister Arun Jaitley, the ministry said before goods and services tax ( GST), the combination of value-added tax (VAT), excise, sales tax and their cascading effect resulted in high standard rate of tax up to 31 per cent.

“It is now widely acknowledged that GST is both consumer and taxpayer-friendly. While the high tax rates of the pre- GST era acted as a disincentive to paying tax, the lower rates under GST helped to increase tax compliance,” the ministry said.

The number of assessees covered by the GST at the time of its inception were about 65 lakh. Now the assessee base exceeds 1.24 crore.

GST, which subsumed about 17 local levies, was rolled out on July 1, 2017. Jaitley held the finance portfolio in the first term of the Modi government since 2014.

“As we remember Arun Jaitley today, let us acknowledge the key role he played in the implementation of GST, which will go down in history as one of the most fundamental landmark reforms in Indian taxation,” the Ministry tweeted.

The multiple markets across India, with each state charging a different rate of tax, led to huge inefficiencies and costs of compliance.

“ GST has reduced the rate at which people have to pay tax. The revenue neutral rate as per the RNR (Revenue Neutral Rate) Committee was 15.3 per cent. Compared to this, the weighted GST rate at present, according to the RBI, is only 11.6 per cent,” the ministry said.

Businesses with an annual turnover of up to Rs 40 lakh are GST exempt. Initially, this limit was Rs 20 lakh. Additionally, those with a turnover up to Rs 1.5 crore can opt for the Composition Scheme and pay only 1 per cent tax.

“Once GST was implemented, the tax rate on a large number of items was brought down. As of now, the 28 per cent rate is almost solely restricted to sin and luxury items. Out of a total of about 230 items in the 28 per cent slab, about 200 items have been shifted to lower slabs,” the ministry said.

Also, the housing sector has been placed in the 5 per cent slab, while GST on affordable housing has been reduced to 1 per cent.

“All processes in GST have been fully automated. Till now 50 crore returns have been filed online and 131 crore e-way bill generated,” the Ministry added.

Source: Economic-Times.

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GST Council To Explore Making E-Way Bills Must For Moving Gold Within States

GST Council To Explore Making E-Way Bills Must For Moving Gold Within States

A Group of Ministers has agreed that states can individually decide to make e-way bills mandatory for the movement of gold within their territory to check tax evasion.

The panel decided that if states want to implement the e-way bill mechanism for gold and precious stones, they can do so for intra-state movement of the commodity, Thomas Isaac, Kerala finance minister and head of the panel; and Bihar Deputy Chief Minister Sushil Modi, a member of group, told BloombergQuint.

Currently, inter-state movement of goods over Rs 50,000 requires an e-way bill but gold is exempt. Given tax evasion and smuggling of gold, the GST Council created a group of ministers to examine if implementing the e-way bill mechanism for gold and precious stones is feasible. GST on gold is levied at 3% while precious stones and diamonds are taxed at 0.25%-3% .

The legal changes required to make e-way bill generation compulsory for intra-state movement of gold, and a monetary threshold for gold will be worked out by the officials of Department of Revenue, Modi said. The proposal will then be taken to the GST Council for its final approval.

Isaac told BloombergQuint that a proper tax administration is needed for gold. States like Gujarat, known for gold and diamond industry, had reservations about data of transportation of gold and diamonds being revealed if e-way bill system is implemented as it tracks the transport of goods, he said.

The panel agreed to implement the system within a state and secrecy of movement of goods will be maintained, with only commissioner-level officials dealing with the information, Isaac said.

The panel was not in favour of making e-way bills mandatory for inter-state movement of gold as it’s “not feasible” and will complicate the system, Modi said.
E-way bill generation for inter-state movement of gold and precious stones may lead to security concerns as such consignments would be tracked, according to a government official.

Tax evasion in gold is rampant, and the government needs to come up with some framework to control it, Rajat Mohan, a partner at AMRG & Associates, told BloombergQuint. “Implementation of e-way bill system for intra-state movement of gold will help in restricting tax evasion as trade in the commodity mostly happens within a state.”

Besides, Isaac and Modi, the panel includes Gujarat Deputy Chief Minister Nitin Patel; Karnataka Home Minister Basvaraj Bommai; and Manpreet Singh Badal and Amit Mitra, finance ministers of Punjab and West Bengal.

The ministers have yet to submit their final recommendations to the GST Council, and will also explore if e-invoicing system—that’ll be implemented from Oct. 1—can be extended for gold, Modi said.

There’s a proposal to make e-invoicing and e-billing mandatory for jewellery shops, Isaac said. To check smuggling of gold, a reverse tax will be proposed on sale of the old yellow metal, he said. Currently, smuggled gold is sold as old gold, and a tax under the reverse-charge mechanism tax would mean the buyer will have to pay tax, for which he can claim credit, Isaac said. “This will help in keeping a check on smuggled gold that has doubled to about 2,000 kg in 2019-20.”

Source: Bloomberg-Quint

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CBIC extends the validity of E-Way Bill till June 30, 2020

CBIC extends the validity of E-Way Bill till June 30, 2020

The Central Board of Indirect Taxes and Customs (CBIC) on Tuesday extended the validity of Electronic Way (E-way) (E-way) bills till June 30, 2020, for all those e-way bills which were generated on or before March 24, 2020, and had expired between the period from March 20, 2020, to April 15, 2020.

In the notification, in the first paragraph, in clause (ii), for the proviso, the “Provided that where an e-way bill has been generated under rule 138 of the Central Goods and Services Tax Rules, 2017 on or before the 24th day of March, 2020 and whose validity has expired on or after the 20th March, 2020, the validity period of such e-way bill shall be deemed to have been extended till the 30th day of June, 2020.” proviso shall be substituted.

This notification has come as a major relief to transporters and truckers.
Earlier, the government had extended till May 31st the validity of e-way bills, required for inter-state movement of goods worth over Rs. 50,000.
In the E-way bill system businesses and transporters have to produce before a Goods and Services Tax (GST) inspector e-way bill for moving goods worth over Rs 50,000 from one state to another.

Currently, e-way bills have a validity of 1 day for every 100 km. For over-dimensional cargo (ODC), like trucks, the validity is 1 day for every 20 km. The government had announced a country-wide 21-day lockdown beginning March 25 to contain the spread of coronavirus.

This notification shall come into force with effect from the 31st day of May, 2020.

Read More: https://www.taxscan.in/preview/?previews=1Q_wQz05O71N_Th8-yB5PiODfLy-mURpm

Source: TaxScan.

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GST collections for April and May set to decline drastically

GST collections for April and May set to decline drastically

Goods and services tax (GST) collections are set to fall drastically in April and May with the number of electronic permits or e-way bills generated for transporting goods decreasing by close to 30% in March and by more than 80% in April sequentially, reflecting a general contraction in economic activities, according to official data.

E-way bills are required for transporting goods worth more than ₹50,000 within and across states. These enable officials to keep a tab on transactions without physically interfering with goods movement.

Businesses had generated only 6.7 million e-way bills from 1 to 27 April, against the 40.6 million generated in March, according to data available from GST Network (GSTN), the company that processes tax returns.

The estimated more than 83% fall in e-way bills generated in April is set to have a telling effect on the GST revenue to be collected in May, which is slated to be repo-rted on 1 June.

Businesses have time till the 20th of a month to pay taxes for transactions in the previous month. As such, May revenue is set to reflect the full impact of the drop in economic activities because of the lockdown.

Signs of the impact the lockdown had on March sales are also expected to be visible in the GST collections being made in April. This will get reported on 1 May.

The 40 million e-way bills generated in March reflect a 28.9% drop from the over 57 million e-way bills generated in February. One major reason is that the World Health Organization declared covid-19 a pandemic on 11 March.
In the April-March period of FY20, GST revenue collection grew by 3.8% to ₹12.2 trillion from the year-ago period.

Source: Money-Control

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Covid-19: Govt extends e-way bill validity, defers restricted ITC under GST

Covid-19: Govt extends e-way bill validity, defers restricted ITC under GST

The government on Friday extended the validity of e-way bills and deferred the application of restricted 10 per cent input tax credit under goods and services tax (GST) giving relief to the industry dealing with supply and cash flow issues amid the coronavirus (Covid-19) induced lockdown.

The validity of e-way bills that were set to expire between March 20 and April 15, has been extended till April 30 to help companies facing supply-related issues with orders stuck in transit in most cases.

“Where an e-way bill has been generated and its period of validity expires during the period 20th day of March, 2020 to 15th day of April, 2020, the validity period of such e-way bill shall be deemed to have been extended till the 30th day of April, 2020,” the finance ministry said in a notification issued late evening on Friday.

Under the GST regime, e-way bill has to be generated if goods worth over Rs 50,000 are transported. An e-way bill is valid for up to 24 hours for a distance of 100 km, depending on the size of the vehicle. However, if the vehicle does not cover 100 km within 24 hours, another bill has to be generated. For every 100 km travelled, the bill is valid for one additional day.

The central board of indirect taxes and customs (CBIC) also deferred the application of 10 per cent restriction for availing input tax credit for February, to August, and rolling over the cumulative applicability to the month of September this year. The seven-month window will ease industry’s working capital and cash flow.

In order to plug evasion, the GST Council in had in December restricted input tax credit to 10 per cent of the eligible amount for an entity if its supplier has not uploaded relevant invoices detailing the payments made. It was tightened from 20 per cent introduced in October.

The GST collections fell below the Rs 1-trillion mark in March after a gap of four months, although disruption caused due to coronavirus-induced lockdown will only get captured in the subsequent months.

Source: Business-Standard

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GST collection slips below Rs 1 trillion in March after four months

GST collection slips below Rs 1 trillion in March after four months

Goods and services tax (GST) collection fell below the Rs 1-trillion mark in March after a gap of four months, even as disruptions caused by the coronavirus-induced lockdown will get captured only in the coming months.
The numbers pertain to GST paid in February but collected in March, suggesting that collections might turn grimmer going forward.

The GST mop-up in March stood at Rs 97,597 crore, down 8.4 per cent on a year-on-year basis, the data released by the Ministry of Finance showed on Wednesday. The government had targeted a collection of Rs 1.25 trillion in March. GST collection grew by a meagre 3.7 per cent in the full fiscal year 2019-20.

The dismal collection in March is despite the stringent anti-evasion measures introduced by the government, including the blockage of e-way bill and restricting input tax credit to 10 per cent in the case of failure of invoice uploads by suppliers.

Already hit by an economic slowdown, the country went into a 21-day lockdown from March 24 to prevent the spread of Covid-19. All industries that were struggling have become non-operational, which will reflect in the April GST collection figures.

Kerala Finance Minister Thomas Isaac told Business Standard that the April numbers, which would essentially be transactions in March would only be about 15-20 per cent of the March figures.

Pratik Jain, partner, India, said, “It seems that many businesses may not have been able to pay GST because of liquidity issues being faced after the lockdown. As the second half of March 2020 has been significantly impacted due to the Covid-19 outbreak, collections in April are likely to be substantially lower.”

In a major relief for businesses facing lockdown due to coronavirus, the last date for GST return filing for March, April and May 2020 has been extended to June 30, with no interest, late fee and penalty, for companies with up to Rs 5 crore turnover and subsidised interest of 9 per cent, and no penalty or late fees for bigger companies.

M S Mani, partner, India, said it was necessary for businesses to conserve cash in order to enable resumption of operations once the lockdown ends. Hence, any deferral of the GST payment timelines by a few months would significantly assist them in this process, Mani said.

Central GST collection for FY20 at Rs 4.95 trillion fell Rs 18,188 crore short of revised estimates for the fiscal year. The finance ministry, in Union Budget 2020-21, had lowered the CGST collection target for FY20 to Rs 5.13 trillion from Rs 5.26 trillion estimated in July.

Of the Rs 97,597-crore revenue in March, the central GST collection stood at Rs 19,183 crore, state GST at Rs 25,601 crore and integrated GST at Rs 44,508 crore, which included Rs 18,056 crore collected on imports, the finance ministry said in a statement.

GST collection on domestic transactions witnessed an 8 per cent decline, while GST collection on imports posted a negative growth of (-)23 per cent, indicating the beginning of Covid-related supply and demand disruption.

In order to plug revenue leakages, the Council allowed blocking of input tax credit in the case of fraudulent invoices and blocking of e-way bills in the case of non-filing of returns for three straight months.

The Council in its meeting on March 14 deferred the new simplified returns and e-invoicing till October, which was to be launched from April 1. Meanwhile, in order to improve collections, the government is aiming to correct inverted duty structure. It raised the GST on mobile phones to 18 per cent from 12 per cent, bringing the rate on a par with the inputs.

Lower-than-expected revenues are also putting pressure on the Centre to compensate states for the revenue shortfall. The compensation cess collection stood at Rs 8,306 crore during the month, much smaller than the approximately Rs 14,000-15,000 crore compensation required by states on a monthly basis. States are up in arms with the Centre over a delay in payment of compensation dues and are planning to drag Centre to the Supreme Court.

Source: The-Business-Standard.

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GST authorities detect fraud of over Rs 214 cr

GST authorities detect fraud of over Rs 214 cr

An anti-evasion wing of Central-GST has detected a fraud of more than Rs 214 crore through fake invoices in Delhi, an official release said on Wednesday.

A person has been arrested and sent to judicial custody of 14 days, it added.

The fraud was detected by the anti-evasion wing of CGST Delhi South Commissionerate.

The alleged case of input tax credit fraud was taking place through fake invoices issued by bogus firms.

Investigations found the accused had also been generating bogus e-way bills to back the fake invoices, the finance ministry said in the statement.

“Over 35 entities are involved in the bogus transactions, involving fake invoicing to the tune of Rs 214.74 crore and tax evasion of Rs 38.05 crore,” it said.

Further investigations in the matter are in progress, the ministry said.

Source: Hindustan-Times

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New GST filing format, e-invoicing to help in ease of doing biz, reporting for taxes: GSTN CEO

New GST filing format, e-invoicing to help in ease of doing biz, reporting for taxes: GSTN CEO

GST Network CEO Prakash Kumar on Friday said e-invoicing and the new format for filing GST will help improve the ease of doing business and reporting for the indirect taxes.

“E-invoicing is a step towards improving ease of doing business and reporting for GST. Manual data entry leads to transcription errors and wrong entries,” Kumar said while addressing an event on ‘E-invoicing and New GST Return Format’ organised by the PHD Chamber of Commerce and Industry.

There is a need for standard to ensure complete interoperability, he said. “The economies in the high-income group OECD are at the forefront of invoice digitisation,” he said. The GSTN CEO said that in India, the aim is to make digitisation part of business process of taxpayers and eliminate all manual reporting.

N K Gupta, chairman (indirect taxes committee) of PHD Chamber, said e-invoicing is the new system through which business-to-business (B2B) transactions are authenticated electronically by GSTN.

This is a major step towards the push for a digital economy, he said and lauded that GSTN is improving every day and GST is digitised to a great extent. Sanjay Aggarwal, senior vice-president of PHD Chamber, said e-invoice is the future means of electronic billing.

It has been adopted by many governments internationally. It has been implemented in a staggering manner over a period of time, initially launched for B2B and B2G (business-to-government), he added.

Source: Economic-Times

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Courier companies seek relief on GST E-way bill rule

Courier companies seek relief on GST E-way bill rule

Courier companies such as FedEx, DHL and UPS are in a bind over delivering imported goods to customers because of a goods and services tax rule that bars defaulters from issuing e-waybills. The document is mandatory for transport of goods worth over Rs 50,000.

On the other hand, the customs department won’t hold such goods in its storage once they’re cleared. The companies, including local ones such as DTDC, Safe Express, Gati and Delhivery, have petitioned the government to seek a way out of the dilemma. The government said it’s examining the issue.

GST Rule 138E, which took effect in November, doesn’t allow an entity that hasn’t filed returns for two straight months to generate an e-waybill.

While the rule won’t impact direct deliveries to ecommerce customers, business-to-business (B2B) orders from overseas will likely get hit.

Import consignments of companies, which may have missed filing returns and are unable to generate an e-waybill, cannot be delivered. But the goods cannot be kept inside the customs premises once cleared.

“As per customs regulations, goods may not be retained in the customs premises post clearance,” Vijay Kumar, chief executive officer of the Express Industry Council of India lobby group. “But moving the goods outside the customs premises without e-waybill would result in noncompliance from a GST standpoint.”

Courier companies have no means of checking whether their customers are GST compliant. “The task itself would be monumental given the volume of transactions and number of clients,” Kumar said. “Tracking such compliances would lead to operational challenges… delay in delivery of goods and reduction in operational efficiency.”

Since courier companies get the goods cleared from customs on behalf of those that place the orders, under the end-to-end logistics model, they face the brunt of the rule, experts said.

“While GST was intended to simplify supply chains, logistics businesses have been facing a few challenges such as EWBs on import consignments, which need to be discussed, as this is a key ingredient in improving the ease of doing business,” said MS Mani, partner.

The government is examining the matter to see how it can be resolved, said a senior government official, adding, “States have some reservations on the issue.”

The official said one option would be for courier companies to seek a written undertaking from customers to the effect that they’re GST compliant. The issue will be taken up again with states, he said.

Source: Economic-Times

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