FM: Only GST Council & States Can Take Call on GST On Petroleum Products

In an interaction with industry leaders in Kolkata, Finance Minister Nirmala Sitharaman reiterated government’s view on including petrol and petroleum products under GST by saying, “It is already covered in the GST and the states have to decide when they want petrol and petroleum products to be taxed under GST.”

Crux of the Matter

The Finance Minister said that there is no need for any new amendment to include petrol under GST. It is upon the states and the GST council to agree on the rate and decide when to charge it from.

At the time of roll-out of GST, after deliberate discussions, a provision was made to include petroleum products in the new regime at zero percent.

Petroleum products have been placed under the GST due to the foresight of the late Finance Minister Arun Jaitley.

Finance Minister Sitharaman spoke deliberately addressing a variety of concerns faced by the industry at the post-Budget interaction organized by the Ministry of Finance in Kolkata.

Curiopedia

Goods and Services Tax (GST) is an Indirect Tax that came into effect from July 1, 2017. It has subsumed almost all the indirect taxes except few; multi-staged as it is imposed at every step in the production process, but is meant to be refunded to all parties in the various stages of production other than the final consumer and as a destination-based tax, as it is collected from point of consumption and not point of origin like previous taxes. Goods and services are divided into five different tax slabs for collection of tax – 0%, 5%, 12%, 18%, and 28%More Info

Govt Treasury Saves Rs. 350 Crore as Data Analytics Helps Govt Dig Fake IGST Refunds

Data Analytics of the Revenue Department found out 1200 exporters linked to GST return frauds. These untraceable exporters are said to have used forged identities, which, as per the government, would have left a digital trail.

Crux of the Matter
  • “The department has reasons to consider those nefarious elements among the customs broker community may be connected with these frauds, involving fictitious entities, existing only in virtual space through identity thefts with fake and morphed documents“, as per Revenue Department’s source.
  • Central Board of Indirect Taxes and Customs may obligate customs brokers under their licensing conditions to independently verifying the KYC of exporters.
  • Revenue department came to know about this fraudulent activity while carrying out physical scrutiny of the firms at their declared addresses, where they found no existence of firms.
  • Around 50 custom brokers have been found guilty for making fake documents, virtual entities. Custom brokers are now under the lens of the Revenue department.
  • Tracing fake web profiles helped the department to dig the fraudulent activity further. It found fraudulent tax credit worth Rs. 195 crores and untraceable suppliers. In total, revenue department has rejected Rs. 350 crores of GST refund coming from fraudulent firms.
  • This kind of incident shows loopholes in the execution of GST.
Curiopedia

Indian Revenue Service – The IRS comprises two branches, IRS (Income Tax) and IRS (Customs and Indirect Taxes), controlled by two separate statutory bodies, the Central Board of Direct Taxes (CBDT) and the Central Board of indirect taxes and Customs (CBIC). The duties of the IRS (IT) include providing tax assistance to taxpayers, pursuing and resolving instances of erroneous or fraudulent tax filings, and formulating and enforcing policy concerning income tax in India. The duties of the IRS (C&IT) include formulation and enforcement of policy concerning the Goods and Services Tax, prevention of smuggling and administration of matters related to Customs and Narcotics. More Info

Number of Active GST taxpayers reaches 1.21 crores

In a relief to the Central government amidst the criticism over the economic slowdown in the country; Sushil Kumar Modi convenor of Group of Ministers (GoM) on integrated GST on December 22 informed that the number of active GST taxpayers has reached to 1.21 crores out of which 66.79 lakh are new registrations.

Crux of the Matter
  • A range of measures to go after tax defaulters and simplifying the GST filing process was discussed by the GST council in Bengaluru.
  • A new user-friendly return system has been decided to be launched from 1st April 2020 which is expected to be much simpler.
  • The GST Council is verifying the 66.79 lakh new registrations for identification of fake or shell companies.
  • The late fee of Rs.100 per day under the GSTR-1 or the outward supply has been waived.
  • GST council meeting has previously decided that if the firms don’t file 3B returns for two consecutive months, their e-way bills will be blocked.
  • Following which 3.47 lakh dealers e-way bills have been blocked by the system and as soon as the 3B return is filed, the system would automatically open for the e-bill to be generated
  • Sushil Modi also informed that only 15% of the new taxpayers have paid the taxes. Thus the states have started physical verification of the new taxpayers by visiting their premises. 
Curiopedia

Goods and Services Tax (GST) is an Indirect Tax that came into effect from July 1, 2017. It has subsumed almost all the indirect taxes except few; multi-staged as it is imposed at every step in the production process, but is meant to be refunded to all parties in the various stages of production other than the final consumer and as a destination-based tax, as it is collected from point of consumption and not point of origin like previous taxes. Goods and services are divided into five different tax slabs for collection of tax – 0%, 5%, 12%, 18% and 28%. However, petroleum products, alcoholic drinks, and electricity are not taxed under GST and instead are taxed separately by the individual state governments, as per the previous tax regime. More Info

To Curb Tax Evasion and Integrate Data, E-Invoicing to be Mandatory in GST Regime

In a move to combat under-reporting or misreporting tax invoices and integrate data, Electronic Invoice System will be implemented for invoicing under the Goods and Service Tax (GST) regime. From the new fiscal year, i.e. April 1, 2020, for businesses having a turnover of more than Rs. 100 crore, e-invoice system may become compulsory to implement for B2B transactions.

Crux of the Matter
  • Since the implementation of GST in 2017, tax authorities have detected tax fraud cases worth Rs. 45,682.86 crores. Around 1000 cases were booked for tax evasion.
  • Owing to the small quantum of collection of GST as compared to the predictions, the e-invoice system can be seen as a way to curb tax evasion and misreporting of GST bills, and to effectively integrate GST data. E-invoice system is also aimed at integrating the e-way bill system.
  • Businesses having a turnover of more than Rs. 500 crore can become a part of the trial run of the e-invoice system from January 1, 2020. Businesses with a turnover of more than Rs. 100 crore can voluntarily opt for e-invoicing from February 1, 2020.
  • For businesses issuing B2C invoices and with more than Rs. 500 crore turnover will be required to install a Quick Response Code (QR) scanner from April 1, 2020.
  • Central Board of Indirect Taxes and Customs (CBIC) has laid out guidelines on how to use the new system. Frequently Asked Questions (FAQs) have been updated on the GST Network website for the reference of businesses, tax consultants, and software developers.
  • Given the troubles faced by small businesses in effectively implementing nuances of GST, the technological hassle that e-invoicing may bring to such small businesses needs to be catered with utmost care.
Curiopedia

GST Implementation in India – Technicalities of GST implementation in India have been criticized by global financial institutions/industries, sections of Indian media and opposition political parties in India. World Bank’s 2018 version of India Development Update described India’s version of GST as too complex, noticing various flaws compared to GST systems prevalent in other countries; most significantly, the second-highest tax rate among a sample of 115 countries at 28%. GST’s implementation in India has been further criticized by Indian businessmen for problems including tax refund delays and too much documentation and administrative effort needed. More Info

GST Collections Cross 1 Lakh Crore Mark in November

Goods and Services Tax (GST) revenue collections recorded a positive growth of 6% in the month of November amounting to 1,03,492 crore rupees. Of this, CGST is 19,592 crore rupees, SGST 27,144 crore, IGST  49,028 crore and Cess 7,727 crore rupees.

Crux of the Matter
  • The impressive 6% recovery comes after two months of negative growth and economic slowdown.
  • As a regular settlement, the government settled 25,150 crore rupees to CGST and 17,431 crore rupees to SGST from IGST.
  • Gross GST revenue collection in October had dropped to Rs 95,380 crore which was to a 5.3% decline on a year on year basis. The lowest collection since February 2018 was in month of September 2019 with mere Rs 91,916 crore.
  • Along with the effects of government’s financial measures experts have attributed the increase due to increased spending during the festival of Diwali.
Curiopedia

Goods and Services Tax (GST) is an Indirect Tax that came into effect from July 1, 2017.It is a comprehensive multistage, destination based tax.Ithas subsumed almost all the indirect taxes except few; multi-staged as it is imposed at every step in the production process, but is meant to be refunded to all parties in the various stages of production other than the final consumer and as a destination based tax, as it is collected from point of consumption and not point of origin like previous taxes. Goods and services are divided into five different tax slabs for collection of tax – 0%, 5%, 12%, 18% and 28%. However, petroleum products, alcoholic drinks, and electricity are not taxed under GST and instead are taxed separately by the individual state governments, as per the previous tax regime. More Info