GST DAY

1. Goods and Services Tax (GST), the comprehensive tax reform after the independence, became operational with effect from 1 July 2017. Its implementation has been considered as a momentous event in the economic history of India as it intends to create “One Nation-One Tax-One Market” by removing the fiscal barriers across the country.

2. The obvious and undisputed triumphs of GST implementation are

1. Emergence of GST Council, a unique establishment which proved itself to be capable of taking swift decisions through consensus in the true spirit of cooperative federalism.

2. Replacement of multi-layered, complex indirect tax structure with a simple, transparent and technology–driven tax regime.

3. Creation of a uniform tax structure throughout the country in r/o of the entire gamut of goods and services, which unquestionably reduced the compliance burden for the business and industry.

4. Removal of cascading effect of taxes which led to the decrease of cost of goods and services.

5. Inflation is under control in the initial phase when compared to other countries.

6. GST is also successful in broadening the tax-base, augmenting the tax revenue and making the tax administration simple and easy.

• The total number of tax payers in Telangana are 3,50,367. Out of these, 1,25,540 tax payers are administered by Central Tax Officers and 224827 tax payers are under the administrative control of State Tax Officers.

• The total GST Revenue for the period 07-2017 top 03/2018 for the State of Telangana is Rs.21361 Cr. And for the period from 04/2018 to 06/2018 (as on 26.06.2018) is Rs. 8610 Cr. Which when compared to the revenue of previous tax regime is on higher side.

 

4. The initial challenges that are thrown up while implementing such a massive tax reform are being resolved with utmost attentiveness. The GST council has shown resilience in responding to the needs of the trade and industry by rationalizing the rates of many goods and services and removing the ambiguities by way of issuing appropriate and timely clarifications. Further, lot of efforts (such as extension of due dates; abolishing/reducing of late fee & simplification of filing of “Nil” return) were made to counter the technical glitches developed in GSTN portal which need no emphasis.

5. Nevertheless, the following points highlight the government’s initiatives to make the legal procedures easier and to increase the tax compliance:

CHANGES MADE IN LAWS:

• Deferment of RCM liability on procurements made from unregistered person till 30th September, 2018;

• Raising of turnover Limit & reduction of rate of Tax under Composition Levy

• Exemption from obtaining compulsory registration U/s 24 of CGST Act, 2017 in case of Inter State Supply of Services;

RATIONALISATION OF TAX RATES:

• At the time of introduction of the GST, tax rate in respect of many goods have been reduced viz., Purified Water, Tooth Paste, Hair Oil, Soap Stapler etc., [ Rate of tax has been decreased from 27% (pre-GST) to 18% (post GST)]. Further, the Tax rates in respect of more than 200 varieties of goods/services were reduced [from the peak rate of 28% to 18%] in the GST council meetings taking into consideration the pleas made by various stakeholders. These goods include Shampoo, Hair dye, pre & post Shaving creams, Fans, pumps & compressors, Razors & blades, Detergents etc.,

TRADE FACILITATION MEASURES:

• 18 Sectoral Groups have been constituted to highlight specific issues and prepare guidance notes. Two of the Sectoral groups viz., M & E Sector and Drug and Pharma are headed by the Commissioners of Central Tax, Hyderabad Zone.

• The government has put in place an IT grievance redressal mechanism to address the difficulties faced by taxpayers owing to technical glitches on the GST portal.

• Seva Kendras have been created to guide the tax payer in various technical and legal issues as a hand holding exercise. In Hyderabad Zone, 36 Seva Kendras are functioning to assist the tax payers. This apart, each Range acts as a Seva Kendra at field level.

• Dedicated e-mail namely gstqueries.medchal@gmail.com & gstqueries.seccommte@gmail.com have been created to reply to the queries raised by the tax payers.

• Toll Free Number: 1800 599 5399 (5-numbers) has been established to render assistance to the tax payers by clarifying their queries.

• WhatsApp group was formed to disseminate the details of changes in law/press notes/ circulars/ notifications & also to reply queries.

• Advisories are being issued to the tax payers highlighting the defects/deficiencies in the invoices raised by the tax payers duly suggesting the remedies.

REGULATARY MECHANISMS:

• Aiming to protect consumers’ interest, the government established National Anti-profiteering Authority under the GST under Section 171 of the CGST Act, 2017. The GST Anti-profiteering body has the authority to act and mandate the concerned supplier to reduce prices or return the undue benefit availed by him along with interest to the recipient of the goods or services duly imposing penalty. Affected consumers may file an application before the Standing Committee,(if the profiteering has all-India character) or before the State Screening Committees (if the profiteering is of local nature). Govt. of Telangana has constituted the State Level Screening Committee(SLSC) on Anti-profiteering [to receive the complaints and to forward the same to Standing Committee (SC) after scrutiny] with the following members:

1. Shri M. Srinivas, IRS, Commr. Central Tax

2. Smt. B. Amrutha Lakshmi, Addl. Commr, State Tax. 

Till date, 2 complaints alleging profiteering have been forwarded by SLSC to SC for necessary action.

• GST, enforcement measures have been gradually put in place – due to many Non-filers & intelligence of evasion of Tax. In Hyderabad Zone - 23 cases (Rs. 41.09 Cr.) have been booked against tax evaders so far; and Rs. 22.35 Cr. Tax was recovered (Rs. 11.15 Cr. in cash and Rs. 11.20 Cr. in credit).

• As per the recent announcement, the E-way Bill system in respect of inter-state supplies will be rolled out w.e.f 01.04.2018. The same essentially acts as a deterrent against tax evasion as the Department will have the details of the movement of all the goods above the value of Rs 50,000 and can spot the discrepancy if either the supplier or the purchaser does not file tax returns/does not show the transaction in the tax returns filed.

THE WAY AHEAD:

• Government is very much conscious of the fact that the success of any tax regime lies in making it simple both for the taxpayers and tax administrators and therefore, the GST Council has constituted a committee to simplify the process of filing of returns without compromising on the basic doctrines of the GST regime (i.e. matching of invoices etc.).

• Further, a law review committee consisting of senior officials of the centre and the states is in the process of recommending changes in the GST laws so as to make the law simple & taxpayer-friendly. The reports of the committees are to be discussed in the forthcoming meetings of the GST Council and further simplification and improvements of laws could be expected.

As stated earlier, GST is an innovative and a pioneering tax concept and its stabilization results in robust tax base, buoyancy in tax revenue, ease of doing business, and a boost to “Make in India”.