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Government Extends Deadline for Filing of GSTR 1 for July

The government on Saturday said it is extending the deadline to file GSTR 1 for July.

The government has also decided to form a 3-member inter-ministerial team to look at the technical issues around GSTN and the problems users were facing in uploading their returns on the portal. The decision was taken at the 21st Meeting of GST Council at Hyderabad on Saturday.

“Formation of the three member inter-ministerial panel to look at the functioning of GSTN to address issues pertaining to uploading of the returns on GSTN appears to be a good move. Hope this panel not only looks at the issues being faced, but more importantly provides quick resolution for the same,” says KPMG India, Partner-GST, Harpreet Singh.

According to the government 45 plus lakh GSTR-3B returns have been filed, and only 17 lakh GSTR-1 had been filed till Friday. Around 13 plus crore invoices had been filed. However, with the GST portal crashing frequently, there has been widespread outrage among taxpayers about their inability in filing returns.

After the GST portal stopped functioning, the Government on September 4 has extended the deadline to file GSTR 1 to September 10. Subsequently, filling of GSTR 2 and GSTR 3 was also extended to September 25 and 30 respectively.

http://economictimes.indiatimes.com/small-biz/policy-trends/government-extends-filing-of-gstr-1-for-july-till-september-15/articleshow/60439308.cms

GST Council’s JUNE18 Meet to Finalise E-way Bill, Anti-profiteering Rules

NEW DELHI, JUNE 15:

With less than two weeks to go, the Centre and States are hoping to wrap up discussions on the goods and services tax (GST) this weekend and approve the e-way bill and anti-profiteering rules.

The GST Council will meet on June 18 and will also finalise the tax rate on lottery as well as the other remaining rules.

“The main agenda items are approval of draft GST rules and related forms for advance ruling, appeals and revision, assessment and audit e-way bill and anti-profiteering,” the Finance Ministry said in a release on Thursday, adding that it may also look into fitment and adjustment of GST rates on some more items.

The Council had met on June 11 when it lowered rates on 66 items and also approved rules for accounts and records under GST.

“We hope this is the last round of discussions and all pending issues are finalised. Another meeting may take place after this but only to review the preparedness for the new regime,” said an official source.

The government hopes to roll out GST from July 1.

But approval of the all-important anti-profiteering rules and e-way bill, which are seen as critical components of the new regime are still pending.

While the Council has already approved the mechanism for the anti profiteering agency, it is yet to be notified until the final rules are approved.

The draft e-way bill was issued in April and made it mandatory for movement of goods of over ₹50,000 to be registered with the GST Network. While the States are keen to roll it out with the new tax regime, the requisite infrastructure is still not in place. The Centre and the GSTN have indicated that it should be pushed back by a few months.

Rate on lottery

Meanwhile, the GST Council also has to finalise the tax rate on lottery.

With a number of States like Kerala, Sikkim and Maharashtra earning significant revenue from lottery, sources said that the Council may choose to follow the model for entertainment under GST.

Lottery is likely to be put in the 28 per cent tax slab under GST, along with a cess. States would then also levy an additional tax or cess at the local level to ensure that they do not lose out on revenue.

Automobiles

The Council will also review the tax position on automobiles as manufacturers have been calling for a re-look on the proposed GST rate on hybrid cars.

The Council had last month fixed 43 per cent tax (28 per cent GST plus 15 per cent cess) on hybrid cars and Finance Minister Arun Jaitley had indicated that it may not be reviewed. However, a discussion paper was floated.

http://www.thehindubusinessline.com/economy/gst-council-to-meet-on-june-18-to-finalise-draft-rules-tax-rate-on-lottery/article9727657.ece

ICAI Sets up Desks to Help Traders With GST

Chartered accountants’ apex body Institute of Chartered Accountants of India (ICAI) has set up desks to help small businessmen and traders on Goods and Services Tax (GST), which is set to be rolled out from July 1.

ICAI GST Sahayata Desks have been made operational, without any charge, in all major cities to facilitate small businessmen, traders, shopkeepers and public at large.

ICAI said these desks would be made operational at around 200 locations in all different parts of the country. Among others, these desks would create basic awareness on GST, inform individuals about the benefits and help them in migration to the new system.

“The GST Sahayata Desks would be operational w.e.f May 28, 2017, till September 30, 2017, at a pan-India level,” it said in a release today. The GST would replace multiple taxes system from July 1, and it would also boost economic growth in the country because of the development of a common market, ICAI President Nilesh S Vikamsey said.

 

http://www.moneycontrol.com/news/economy/policy/icai-sets-up-desks-to-help-traders-with-gst-2291937.html

GST: India’s Great Migration Challenge

New Delhi: Amid all the lobbying in fixing goods and services tax (GST) rates and with the 1 July implementation deadline fast approaching, businesses are busy completing the migration process. Businesses have to migrate from the present value-added tax (VAT), service tax and central excise registration to a GST registration.

Out of 84 lakh entities, 60.5 lakh have registered with the GST Network (GSTN), said a recent finance ministry statement. The enrolment window, which was suspended on 30 April, has been reopened on 1 June for 15 days.

However, it should be noted that those already registered under the GST portal can migrate. Fresh registrations are yet to begin.

Given the very large number of assessees and the plethora of details required to be furnished, migrating to a new tax regime was never going to be a cakewalk. As anticipated, there are a slew of challenges businesses are facing, the most common being of integration and upgradation of existing IT infrastructure to make it GST compliant, tax experts pointed out.

Though there is a certain level of IT enablement even today in excise and service tax, GST will significantly enhance the dependence on the IT interface. While larger organizations are better equipped to overcome this hurdle, small and medium sized enterprises are struggling.

Manual invoicing will soon be a thing of past and even completion of the migration process is an additional task requiring new manpower and costs.

The not-so-user-friendly migration process and inability of the GSTN to bear the load of data at certain times is giving businesses a tough time, tax experts said. The government is firm about GSTN being completely prepared to deal with the sea of data, but it would be interesting to see how things pan out post 1 July.

Secondly, large businesses now have to ensure that not only them, but their vendors too are registered on the GST network.

“This is a key challenge while migrating because dealing with non-registered vendors would increase the compliance burden, affect ability to claim input tax credit and impact compliance ratings,” M.S. Mani, senior director-indirect tax, Deloitte Haskins & Sells LLP, said.

Further, many companies may have to rework long-term contracts with customers and standardize them while migrating to GST. “This may not be acceptable to their customers and hence an elongated negotiation cycle would begin. Re-framing a large number of contacts is certainly a difficult task,” he added.

Also, between service providers and manufacturers, the former are likely to face larger migration challenges than the latter, mainly because manufacturers are used to a slew of indirect taxes and registrations, but service providers in the pre-GST era were not used to dealing with state authorities, with many of them having a centralized service tax registration. Registration at multiple locations comes as a bigger hurdle for them, tax experts said.

To conclude, for a country of our size, migrating to a unique and customized GST regime is nothing less than historic. Though beneficial in the long-term, a run up to GST implementation has led to near-term supply-chain disruption. Complex rules and rate structure are sure to increase the compliance burden, especially for small and medium companies and the jury is still out whether GST will really improve the ease of doing business in India.

Centre, States May Settle For 4 Percent GST on Gold, Silver

NEW DELHI: The Centre and the states may settle for 4% goods and services tax (GST) on bullion and opt for a special rate for financial services, amid intense lobbying from the two sectors in the run up to the rollout from July.

In addition, the GST Council — the apex decision-making body comprising state finance ministers and headed by Union finance minister Arun Jaitley — is discussing whether to include handloom and handicrafts as well as bidis in the tax net, although the house is still divided.

Sources told TOI that bidis, which are currently exempt, may be brought under the net as they are sin goods, like cigarettes, which will face a cess. Cigarette companies have been arguing for a while that bidis should also be subjected to high taxes but there is a lobby that has been making a case for keeping it out, given that thousands depend on it for livelihood.

A similar case is also being made for handloom and handicrafts, where some of the states as well as the textiles ministry is in favour of either exempting them from GST or keeping them at zero rate. But there is an equally powerful argument to ensure that GST of 5% is levied. Sources also said that in case of gold and silver the southern states are in favour of a 6% levy, considering some of them levy up to 5% VAT. In contrast, some of the western states are keen on a low levy of 1% or so. While slabs for goods were finalised by the GST Council, bullion and services were kept out of the decision.

Revenue secretary Hasmukh Adhia recently indicated that there may be two rates for services, although he refrained from disclosing the levels. Experts believe that certain services may be put in the 18% bracket with a lower levy of 12% on others.

In addition, sources said, a special dispensation may be made for financial services — such as banking and insurance — which has been lobbying with the GST Council for a simpler regime, including an exemption from state-wise registration.

The decision on rates is expected at the next meeting of the GST Council, scheduled in Srinagar on May 18 and 19, where product-specific levies are expected to be finalised along with rules that will govern the new tax regime. The commerce ministry is also keen that some of the concerns such as refund of taxes to exporters be reworked.

http://timesofindia.indiatimes.com/business/india-business/centre-states-may-settle-for-4-per-cent-gst-on-gold-silver/articleshow/58635963.cms

GST: Tax Headache in India Is a Bonanza for Global Accounting Firms

What is taxing for some in India has become brisk business for others.

With seven weeks to go before the nationwide Goods and Services Tax is implemented, Indian companies are rushing to bring in experts to help prepare their accounting and information technology systems for the tax-system overhaul. That’s created a windfall for international professional services firms, including PricewaterhouseCoopers LLP and KPMG LLP.

Providing advice on everything from taxation regulations to business finance will generate as much as 150 billion rupees ($2.3 billion) in extra consulting fees, according to a council member of India’s accounting regulator, the Institute of Chartered Accountants of India. PricewaterhouseCoopers said it’s pulled in a specialist from Australia to help bring Indian companies into compliance with the new taxation regime, which starts July 1.

“We are helping our clients’ transition to GST in phases,” said Pratik Jain, a partner leading the firm’s indirect taxes arm in India, in a telephone interview. The firm has a team focused on GST-driven demand that’s drawing on advice from abroad “plus a pool of international experts when needed,” he said.

Representatives from Ernst & Young LLP and KPMG said they are also fielding calls for help from businesses struggling to assess the impact of the GST’s implementation and how best to implement computer-based systems to manage their supply chain, procurement and accounting processes.

KPMG India

KPMG India has a team of more than 1,100 people with skills across GST, IT and supply chain management to support about 400 clients from a wide range of industries transition to the new tax system, said Sachin Menon, a partner and the firm’s national head of indirect taxes. International experts have also been drawn in to help clients, he said.

The complex process of converting an economy with more than 1 billion consumers into a unified, common market has bolstered demand for enterprise resource planning, or ERP, said Ashish Mittal, co-founder of EasemyGST, an IT service provider in Gurugram near Delhi.

“We are in touch with 1,000 companies of which half have agreed to go with us,” Mittal said. About 200 inquiries were from medium to small businesses, he said.

Helping companies be fully compliant with the new system is difficult, as detailed guidelines aren’t yet available to provide the necessary clarity, PricewaterhouseCoopers’ Jain said.

“Corporate clients want more detailed guidelines and illustrations based on specific sectors,” he said. So far, clients have indicated that guidelines for getting credit for taxes paid are more restrictive, and lack of clarity on registration of taxpayers with multi-state operations is “a huge issue” under the new system.

More Clarity

Rules and specific rates of taxation aren’t yet finalized, according to the council member of the Institute of Chartered Accountants of India, who asked not to be identified because only the institute’s president is authorized to speak to the media. Without more granular detail, it will be impossible for organized industries to comply from July 1, let alone India’s 40 million small-scale enterprises, 70 percent of which are unorganized and haven’t started the process of readying their businesses the member said.

India has about 300,000 sales-tax accounting practitioners who help mostly small businesses file returns and comply with tax laws. In addition, there are 150,000 chartered accountants employed in India of which 80,000 need to be trained, the member said.

Businesses with more than 10 billion rupees in revenue typically spend 6 million-to-10 million rupees on accounting services, representatives of two accounting firms said. This cost will probably double at least in the first year of the GST’s implementation, they said.

Assam Assembly Passes GST Bill

Guwahati, May 11 () Assam Assembly today passed the GST Bill, paving the way for introduction of single taxation system by eliminating levies by multiple authorities.

The Assam Goods and Services Tax Bill, 2017, which had been tabled on Monday, was passed unanimously by the Assembly in a three-day special session to pass the bill.

“The GST will be a win-win for all the three stakeholders — country, state and consumers,” Assam Finance Minister Himanta Biswa Sarma said.

Presently, inflation was likely to fall by 0.5 per cent and after fourth year, the state’s revenue would increase substantially and stabilise possibly after 10 years, he said adding that five/six taxes would be abolished.

Corruption was likely to go down with introduction of GST as everything would be computerised and manual interference would almost be abolished, the minister said.

Former chief minister Tarun Gogoi said that Congress supported the GST Bill, but there were some concerns like the fate of local small industries on the face of free flow of goods from outside after withdrawal of entry taxes.

Chief Minister Sarbananda Sonowal termed the day as historic.

“Today is a historic day for Assam as the GST Bill has been passed in the state assembly which will go a long way in promoting the spirit of cooperative federalism in the country,” Sonowal said at a programme outside the Assembly.

This would also ensure transparency in governance and lead to economic growth, he said.

http://timesofindia.indiatimes.com/business/india-business/assam-assembly-passes-gst-bill/articleshow/58637172.cms