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GST-Returns
With 9% interest on delayed payment, taxpayers avoid deferring GST filings

With 9% interest on delayed payment, taxpayers avoid deferring GST filings

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Many large taxpayers, those with annual turnover of Rs 5 crore or more, are not availing the extension for paying GST and filing returns as many of them find the 9 per cent per annum interest from the due date too exorbitant.

The government has, in order to lessen the compliance burden on businesses given the outbreak of coronavirus, extended the dates of filing GSTR 3B returns due in March, April and May 2020 to last week of June 2020. Usually, the date for filing returns for a particular month is 20th of the next month. So, for March, the date of filing returns in 20 April, and that for April is 20 May.

Those having aggregate annual turnover less than Rs 5 crore, no interest but late fee and penalty will be charged. But for those with turnover of Rs 5 crore or more, an interest at the reduced rate of 9 per annum from due date (against the current rate of 18 per cent) will be charged.

For businesses with large tax liabilities, delaying the tax payment by three months would mean a large interest outgo, and hence those taxpayers, who have sufficient cash-in-hand are planning to pay the taxes and file returns on time.

“The industry has taken a mixed approach on the delayed return filing, depending upon the cash flow situation. The comparison which is done is the 9 per cent interest (on late payment of GST) and the interest on bank loan. However, filings have slowed down on an overall basis,” says Ritesh Kanodia, partner.

But not all businesses are weighing options between paying interest on late payment of GST and interest on bank loan. For many SMEs with turnover of Rs 5 crore or more, the question is whether to pay the salaries or file GST returns.

Nidhi Goyal, managing partner, says: “Those SMEs which have enough cash flow to pay salaries would like to pay GST liabilities on time and save on the 9 per cent interest cost that they otherwise would incur.

Some businesses are also taking advantage of the fact that the load on GST Network, the IT backbone of the GST regime, will be somewhat less, and are finishing some of the compliances despite the extension of dates.

Rajat Mohan, partner in chartered accountancy, says unlike in normal times around the due dates, one invariably face problems in filing returns, right now the GST Network is working smoothly.

Rajesh Gupta, Co-Founder & Director, says: “Due to lockdown, business transactions have been reduced and left with only 10-20 per cent in total, so accordingly, the load on the network is less as compared to normal. So the network is working smoothly and helping taxpayers to work at home. It has enabled almost more than 20,000 registrations with 10-13 days of the first phase of lockdown.”

Source: Business-Today

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GST-affect-Indian-Businesses
GST portal glitches to dominate agenda of Council meeting on Saturday

GST portal glitches to dominate agenda of Council meeting on Saturday

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Glitches on the goods and services tax (GST) portal will dominate the agenda of the Council meeting on Saturday, even as states will vehemently seek resolution of delayed compensation issue. Infosys Chairman Nandan Nilekani has been asked to make a presentation before the Council.

“Hassles on the GST portal even 30 months after roll-out is unacceptable and that has been communicated to both GST Network and Infosys,” said a government official.

States are likely to demand that Infosys should have a point of contact in each state to resolve these glitches, the official said.

Meanwhile, the electronic invoice facility is likely to be deferred by three months from April 1 to July owing to lack of readiness of both GSTN and the taxpayers.

Finance Secretary Ajay Bhushan Pandey took a detailed meeting with Infosys officials on March 7 on the GSTN-related matters, more importantly ahead of the crucial roll-out of new simplified returns from April 1. GSTN’s tech support partner Infosys has been asked to come up with a plan for quick resolution within a fortnight.

System capacity constraints and the inability of GST Network to provide smooth return filing will be taken up at the Council.

With new returns format to be rolled out from April, it was imperative for GSTN and Infosys to work effectively, he added. The department of revenue, in a letter to Infosys on March 5, highlighted that the issues flagged in 2018 were still unresolved and that failures month after month resulted in genuine taxpayers getting frustrated.

“It is requested to go through the pending issues, day-to-day disruptions and the future road map and come up with a plan for quick resolution within 15 days. Infosys has set high international standards and it is expected that the efficiency which your organisation is known for should be visible in GST project also,” the letter said.

It also said even though the GST system has been in operation for the last 30 months, there have been instances of taxpayer complaints on facing issues in filing returns in the last two days of filing of returns.

“It is noticed that MSP (Master Service Provider) Infosys has been repeatedly asked to take timely action and to identify the root cause of issues after each event and taken corrective action. However, problem still persists,” it said.

The ministry said such glitches on the portal led to an unhealthy tax compliance requirement, more so when on account of such disruptions some taxpayers end up becoming liable for payment of late fee, interest.

The ministry is working to shore up GST revenues. In the April-February period this fiscal year, GST collection stood at Rs 11.24 trillion, down from Rs 12.67 trillion in the year-ago period.

No response at peak hours, wrong computation of late fees for annual returns for FY18, and offline tool not available for GSTR9 are among a list of problems flagged in the letter.

Compensation cess issue will be raised by the states, who are likely to ask for full compensation for the fiscal year, irrespective of collections and pitch for extension of compensation period. The Centre, meanwhile, is expected to clearly tell states that they will be compensated only as much as is collected in the cess fund, according to the law.

With only 56 per cent of compensation dues for October and November worth Rs 19.958 crore disbursed last month, states are expected to strongly seek a resolution on the matter.

The Centre is supposed to compensate states on a bi-monthly basis for any losses they incur in the first five years of GST implementation. The loss is estimated if they do not record 14 per cent increase in the subsumed indirect taxes keeping 2014-15 as the base year.

The Centre has released a total of Rs 120,498 crore as GST compensation to the states and Union Territories so far in FY20 out of Rs 87,821 crore collected till February.

Source: Business-Standard.

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GSTN
Nandan Nilekani gets govt summons over persisting GSTN glitches

Nandan Nilekani gets govt summons over persisting GSTN glitches

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The government has asked Infosys chairman Nandan Nilekani to explain why the IT major has failed to fix glitches in the GST Network.

According to TNN, Nilekani will have to make a presentation when the GST Council meets next.

The government recently staggerred the deadline for filing returns as Infosys executives were unable to address the concerns. These include a slow platform, log-in errors, as well as delays in getting one-time passwords (OTPs).

Meanwhile, in a strongly worded letter to Infosys on March 5, the ministry said some of the problems highlighted as early as 2018 are still unresolved and failures month after month lead to genuine taxpayers “getting frustrated”.

According to the report, the failure happened despite summons to senior company executives by revenue secretary A B P Pandey, prompting the finance ministry to take up the issue with Nilekani over a month ago. Finance minister Nirmala Sitharaman has also held discussions on the issue, discussing the GST Network, as well as Infosys’s role.

The IT company has developed the software for GST Network (GSTN) — which provides the technology backbone for Goods and Services Tax (GST).

The GST Council, headed by Sitharaman, is scheduled to meet on Saturday.

Officials admitted that the IT platform has not stabilised even two and a half years after GST was rolled out. Even earlier, a ministerial panel had ticked off Infosys as it believed that the IT major had not deputed senior executives across states to tackle glitches that had emerged, prompting the Bengaluru-based company to deploy better quality manpower.

Repeated problems with the platform, which taxpayers claimed often delay filings beyond the deadline and lead to penalties, have also led to the Supreme Court recently asking the government to resolve technical difficulties.

Source: Economic-Times

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GSTN
Gig economy workers may soon have to register under GSTN

Gig economy workers may soon have to register under GSTN

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The government is looking to get services professionals such as plumbers, electricians and beauticians listed on online platforms onto the Goods and Services Tax Network, in what could be yet another move to bring gig economy workers into the fold of the formal workforce.

The Department for Promotion of Industry and Internal Trade ( DPIIT) is considering making it mandatory for online marketplaces such as UrbanClap, HouseJoy and Bro4u to only engage service professionals who have a GST Number or GSTIN, senior government officials in the know of the matter told ET.

While the majority of plumbers, electricians, individual fitness trainers that make use of such online platforms will have a turnover of less than Rs 40 lakh annually, exempting them from paying GST, the government’s move to mandate GSTIN is more in line with having a database of such professionals. “Today, these professionals go into people’s houses and there’s absolutely no way for us to identify them,” said a senior government official.

“While they may not have to pay GST or make the quarterly filings, if they are registered on the network, we can trace them if there’s any untoward event,” said a government official who did not want to be named.

He added that companies such as UrbanClap may be asked to keep a log of all the jobs done by these services professionals, which were facilitated through their platform.

UrbanClap declined to comment as there was no formal communication from the government on the issue. Calls and messages to executives from Housejoy and Bro4u did not yield a response.

“There are several issues that we are examining like consumer safety and protecting the rights of these workers,” said another senior government official, who added that the DPIIT was currently evaluating the matter.

“Even today, there is voluntary GST registration, so it’s not something very big that we are asking them to do.”

Discussions to get services professionals listed onto the GSTN come ahead of the ecommerce policy, which is expected to come out before the close of the current fiscal.

Sources told ET that while the updated policy may dilute sections on data sharing, it could further define rules for online marketplace, inventory-led models and hybrid models.

The ministry of labour and employment is mulling bringing out regulations around the social security of gig economy workers. In its draft Code on Social Security, 2019, the ministry has proposed that all gig workers should be entitled to life and disability cover, health and maternity benefits, old age protection and other benefits

Source: Economic-Times

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GST: GSTR Form 3B
GST returns can now be filed in a staggered manner

GST returns can now be filed in a staggered manner

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In a moved aimed at de-stressing the GST system, the finance ministry on Wednesday staggered last dates of filling GSTR-3B, a monthly return form, and has provided three dates for different categories of taxpayers.

Currently, the last date for filing GSTR-3B is 20th of every month. With the changes, there will three dates — 20th, 22nd and 24th — of every month for different categories of tax payers.

In the past, glitches in the return filing system of GST Network were reported on the last day of filing of returns and trade and industry had to face problems.

It may be noted here that about one-fifth of the total GSTR-3B returns were filing on the last day (January 20).

“From now on, the last date for filing of GSTR-3B for the taxpayers having annual turnover of Rs 5 crore and above in the previous financial year would be 20th of the month. Thus, around 8 lakh regular taxpayers would have the last date of GSTR-3B filing as 20th of every month without late fees,” the ministry said in a statement.

The taxpayers having annual turnover below Rs 5 crore in previous financial year will be divided further in two categories.

The tax filers from 15 states/UTs — Chhattisgarh, Madhya Pradesh, Gujarat, Daman and Diu, Dadra and Nagar Haveli, Maharashtra, Karnataka, Goa, Lakshadweep, Kerala, Tamil Nadu, Puducherry, Andaman and Nicobar Islands, Telangana and Andhra Pradesh — will now be having the last date of filing GSTR-3B returns as 22nd of the month without late fees.

This category would have around 49 lakh GSTR-3B filers who would now have 22nd of every month as their last date for filing GSTR-3B returns.

For the remaining 46 lakh taxpayers from the 22 States/UTs of Jammu and Kashmir, Ladakh, Himachal Pradesh, Punjab, Chandigarh, Uttarakhand, Haryana, Delhi, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand and Odisha having annual turnover below Rs 5 crore in previous financial year the last date will be 24th.

The ministry further said it has also taken a note of difficulties and concerns expressed by the taxpayers regarding filing of GSTR-3B and other returns.

“The matter has been discussed by the GSTN with Infosys, the Managed Service Provider, which has come out with above solution to de-stress the process as a temporary but immediate measure,” it added.

For further improving the performance of GSTN filing portal on permanent basis, several technological measures are being worked out with Infosys and will be in place by April 2020.

A total of 65.65 lakh GSTR-3B forms for the tax month of December were filed by January 20.

Source: Economic-Times

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GSTR
States seek real-time access to GST returns, e-way bills

States seek real-time access to GST returns, e-way bills

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Certain states have sought real-time access to annual Goods and Services Tax (GST) returns and e-way bills in order to check tax evasion, which can potentially address the ongoing fund crunch and help compensate states for their revenue shortfall, two officials aware of the matter said requesting anonymity.

Currently, these data are stored in the GST Network, which compiles reports and sends them to all the states and Union territories with a time lag.

Kerala finance minister Thomas Isaac confirmed the development and said,“Kerala may not require compensation cess at all if it is permitted to have real-time access to annual returns and e-way bills, so that tax evasion could be curbed,” Isaac said.

According to Isaac, ineffective tax collection is one of the three key reasons for tardy GST revenue collections across the country and real-time information would help many states nab evaders through the use of data analytics. The other two reasons, according to him, are the economic slowdown and steep cuts in GST rates.

“I will raise this issue in the GST Council,” he said. The GST Council is the apex decision-making body of the federal indirect tax structure that was rolled out on July 1, 2017. It is chaired by the Union finance minister and has finance ministers of states and Union territories as members.

Officials said states’ access to real-time data could be possible if they formally raised the issue at the council. Several states have been raising the issue of large-scale GST evasion at the council. In August last year, West Bengal finance minister Amit Mitra estimated GST evasion at ₹1 lakh crore and demanded an exclusive meeting on the issue.

Owing to inadequate compensation cess funds, the Centre has not yet compensated states for their revenue shortfall over two months – October and November. Ideally, that should have been paid by the second week of December. Even in the past, there was a delay of about two months in paying compensation for August and September, which was paid just two days ahead of the 38th GST Council meeting on December 18, 2019.

An amount of ₹35,298 crore was released on December 16 to pay states for their dues in August and September. The GST law assures states 14% growth in their revenue for five years and the Centre is committed to meeting any shortfall in revenue through cess money, which is levied on luxury goods and sin products such as liquor, cigarettes and tobacco products.

The finance minister of another state, who did not wish to be named, said that there was scope for improvement in GST compliance but that would not be able to meet the entire revenue gap. Commenting on the proposal on real-time access to GSTN data, the minister said, “I doubt this will eliminate the revenue deficit. The ball is always in our court , provided those at the helm allow it to be dealt with efficiently.”

Experts said access to data would certainly help states in better compliance. Common access could be given to states through login IDs and passwords. Pratik Jain, partner and leader, indirect tax, said, “Logistically it should not be difficult.”

The Union government is making all-out efforts to plug revenue leakages of both central GST (CGST) and state GST (SGST). It will hold a national conference on January 7 to address the issue, the officials cited above said. This conference is being organised to curb fraud and evasion and check fake input-tax credits.

Source: Hindustan-Times

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E-invoice
E-commerce cos may get to upload GST e-invoice for vendors

E-commerce cos may get to upload GST e-invoice for vendors

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 In a significant relaxation for the ecommerce sector, the government could allow online platforms such as Amazon and Flipkart to upload e-invoice for vendors under the goods and services tax (GST) framework. As part of ongoing trials of e-invoicing, a detailed set of clarifications in the form of frequently asked questions have been issued. “Ecommerce operator can request for e-invoice on behalf of supplier,” the clarification said. The matter has been taken up by the government and could be allowed once the trial period is over, a government official told ET. “Trials are now on…It will require an amendment… The issue has been taken up.” The GST Network has issued a detailed set of FAQs.

“Allowing ecommerce platforms to undertake e-invoice compliance on behalf of suppliers would go a long way in facilitating compliance for such suppliers,” said Prashanth Agarwal, partner. Given the criticality, it’s important for businesses to keep track of them. Further, businesses should participate in the testing phase as part of their preparation to go live on April 1, Agarwal said.

Voluntary uploading of e-invoices on the GSTN portal kicked off from January 1, for businesses having turnover over Rs 500 crore. For businesses having annual turnover over Rs 100 crore will be effective from February 1. Only 10,000 line items per einvoice would be allowed, as per the FAQ. Foreign services providers will have to set up local entities to integrate with the invoice registration portal (IRP), as per the FAQs.

Experts say these clarifications will help businesses gear up for the new system.”With specifications for e-invoice API being released to various companies, the government’s intent to soon implement it is reinforced,” said Abhishek Jain, tax partner, EY. “FAQs released provide clarification on ambiguities such as no requirement of invoice registration portal validation for delivery challans and bill of supply, 10,000 line items being allowed per e-invoice, amendments in the GST law on invoicing to align with e-invoices, etc and its timely release should help businesses gear up better for this new system.” The e-invoice system of uploading invoices on government portal will be mandatorily rolled out for businesses with turnover over Rs 100 crore from April 1.

Also, for B2C invoicing issued by businesses with annual turnover over Rs 500 crore, an electronically scannable quick response (QR) code will be mandatory from April 1. The e-invoice will help streamline the indirect tax system and ensure better compliance by keeping a check on tax evasion.

Source: Economic-Times

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GSTN
GST network in local lingo: GSTN CEO

GST network in local lingo: GSTN CEO

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GST Network will be in all languages present in Schedule 8 of the Constitution in two months — a step that will make it easy for assesses in all states to upload returns and other documents with or without the help of a chartered accountant or advocates. Speaking to TOI, GSTN CEO Prakash Kumar said as of now the GSTN has asked all states to translate the details on the website. “At present, the GSTN is only in English and once the states send details in their local languages, it will be made available in those languages,” he said.

The labels on the website will be in the local language. “We received demands for translating the details in all languages and based on that the website will is being re-jigged. The assesses can ask questions and receive replies in their language,” said Kumar. “Initially we had problems as it was a new tax regime. But as of now more than 30 crore returns are uploaded and Rs 75,000 crore is being paid each time when the deadline for uploading returns end. On the last day of deadline, more than 25 lakh returns are being uploaded. We have a stabilised system compared to what we had when we started. But as in any website, if everyone uploads at the same time, there will be problems,” he said. Terming the GSTN as safe from hackers, he said.

The GSTN is also working on a new type of return to make it easy for traders and businessmen to use the network. “By April 1 next year, a new type of return will be in place and it will be easy for the assesses will find it easy. Already we have released the tools for the new returns for the assesses to practice on,” he said.

Source: Times-of-India

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E-Way Bill
Govt blocks GST e-way bill generation; move may impact 300,000 firms

Govt blocks GST e-way bill generation; move may impact 300,000 firms

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Businesses of roughly 300,000 firms paying goods and services tax (GST) were likely impacted on Monday, as the government had blocked e-way bill generation for non-compliant assessees.

These businesses had not filed their monthly GST Return (GSTR)-3B for two consecutive months. The government had notified the rule last month as an enforcement measure amid subdued revenue collection.

The GST system has been grappling with low levels of compliance. Only 65-68 per cent of eligible GST filers file the GSTR-3B within the due date, the GST Network (GSTN) data shows.

“This month, the taxpayer will be alerted with a cautionary message while generating e-way bills, in case GSTR-3B for the past two successive months of the consignor/consignee GST identification number (GSTIN) has not been filed. From next month onwards, such GSTINs will be blocked,” the note had said.

The same has become operational from December 3.

According to the data by the GSTN, the information technology backbone of the two-year-old indirect tax regime, there are 2 million GSTINs that have not filed GSTR-3B for September and October. Of these 2 million GSTINs, 347,000 GSTINs (or 16.7 per cent) had transactions in the e-way bill system for September and October, which are learnt to have been impacted immediately.

“These firms were given enough warning last month that their e-way bill system would be blocked over non-compliance. Businesses not filing returns should not be allowed to move goods,” said a government official.

Firms in Odisha and West Bengal are learnt to have been severely affected with this move. Experts said this has put these businesses in peril.

“Due to slowdown and cash crunch, taxpayers are already struggling to survive. This measure will effectively mean halting business and will have negative consequences for taxpayers and the economy,” said Pritam Mahure, leader at Pune-based accountancy firm Pritam Mahure and Associates.

“Suppose, the supplier of goods has filed GST returns in time, but the person to whom he is selling goods i.e., purchaser of goods has failed to file GST returns, in that case, the supplier who is compliant will not be able to generate e-way bill as his recipient is non-compliant,” said Vishal Raheja, deputy general manager, Taxmann.

The e-way bill facility will get unblocked within three hours of payment of dues and filing returns.

GST collection
GST tops Rs 1 lakh crore on compliance, festival boost

GST tops Rs 1 lakh crore on compliance, festival boost

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Buoyed by festival demand and better compliance, goods and services tax (GST) collections rose 6% in November to top Rs 1.03 lakh crore — the highest since April. Monthly collections in November were the third highest since the transition to the new indirect tax regime in July 2017.

The previous highs were witnessed in April 2019 (nearly Rs 1.14 lakh crore) and March 2019 (over Rs 1.06 lakh crore). But the mop-up grew 3.7% during April-November, compared to the annual target of 13%, prompting officials to suggest that the shortfall in collections could be of the order of Rs 1.5 lakh crore.

“While increase in collection is encouraging, it’s difficult to read too much into the collection for one month, particularly because October was also a month of festivals. We need to see what’s the trend. The government has taken steps in the right direction by simplifying the compliances, going after the tax evaders by more efficient use of technology/data analytics and not falling for temptation of increasing the tax rates. These efforts, coupled with introduction of e-invoicing from next year should lead to gradual increase in GST collections as well, though it would also depend upon overall economy,” said Pratik Jain, who leads the indirect tax practice at consulting firm PwC.

Data released on Sunday suggested that domestic demand — manifested in central and state GST collections — was strong, but an over 13% fall in integrated GST on imports exerted pressure on overall collections. Higher automobile and white goods sales ahead of Diwali helped collections with the government hoping that good monsoon and rural demand will come to its rescue in the remaining part of the current financial year. An official statement seemed to draw comfort from the fact that a decline in GST on imports in November was 13%, compared to 20% in the previous month.

The government was also cheering a near 12% jump in returns for October sales filed by the November 20 deadline with the number of submissions on the GST Network portal touching 77.8 lakh, following a series of steps introduced by the government to improve compliance. For instance, those who do not file returns have now been barred from generating electronic way bills, which is mandatory to ship any consignment of over Rs 50,000.

Source: Times-Of-India

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