GST Connect

Lack of clarity still prevails over GST Although the State Government has warned that it would act tough against business persons not passing on the recently announced concessions in goods and services tax (GST) rates to the people, lack of clarity is still prevailing in billing in hotels and restaurants. Although the hotel and restaurant owners welcomed the slashing of the rate to 5 per cent effective from Wednesday, many customers said they were yet to see the full benefit in the billing even after a day. Minister for Food and Civil Supplies P. Thilothaman told a meeting in Kozhikode on Thursday that the Consumer Affairs and Legal metrology departments would act tough on those people cheating consumers in the name of GST. “Our restaurant suffered a loss of nearly 50 per cent with the introduction of the GST. We expect to see a visible reduction in the prices of food items following the cut in the rates. We may not be getting the input tax credit, but from the customer side, onc

Chandigarh: A delegation of the Chandigarh Beopar Mandal (CBM) today called on RK Choudhary, the newly appointed Assistant Excise and Taxation Commissioner, and submitted a memorandum of city traders’ demands. Ram Karan Gupta, chairman of GST committee of CBM, said a GST advisory committee should be constituted at the earliest with representatives of the CBM as its members so as to forward demands of traders to the GST Council. Source- The Tribune.

New Delhi, Nov 17 (KNN) In an attempt to ease the complications and fast-track the process, the government announced approval of manual filing of the refund claims under the Goods and Services tax regime. Central Board of Excise and Customs informed about the latest decision in a circular. The Circular said that due that due to the non-availability of the refund module on the common portal, the applications, forms and documents pertaining to the refunds of claims on account of zero-rated supplies can be filed and processed manually. Exporters of services who have paid the IGST and those who are making the zero rated supplies to the SEZ units can approach the jurisdictional commissioner and ask for the refund form. Also the merchant exporters can claim for the same at the tax office, the notice informed The move comes in the aftermath of the concerns raised by different stakeholders over the liquidity crisis due to the delay in refunds. Source- knn India.

Lower rates will lead to higher rate of compliance, says Delhi Finance Minister Manish Sisodia, a day after GST cuts were made effective. He tells Dilasha Seth that the rate of 5 per cent on restaurants should have been extended to restaurants in five-star hotels, as the higher rate could encourage evasion and even lead to inspector raj in some cases. Edited excerpts: Several big decisions were taken by the GST Council last week, which came into effect on Wednesday. What impact do you foresee? I am not completely satisfied with the decisions taken by the Council. The benefit of reducing rates on restaurants to 5 per cent will benefit consumers across the country. But, this should have been extended to restaurants in five-star hotels as well. There should be one tax on all restaurants. Could you explain it further? The 18 per cent tax is on restaurants in hotels, which charge Rs 7,500 per night or more. The price changes with season and peak days. Some days of the month,

New Delhi: With news reports surfacing over the drop in the volume of exports of the ready-made garments that involves a major chunk of the Micro, Small and Medium Enterprises (MSMEs), in the month of October by over 41 per cent, there is mixed opinion among exporters over the possible reasons of the slowdown. Talking to KNN, Dharmendra Joshi, Secretary General of the Gujarat Chamber of Commerce and Industry (GCCI) explained the situation. Joshi opined that there is visible slowdown in the overall volume of exports across sectors including the textile sector. Joshi added that the reasons behind the slow figure can be because of a steep international demand. Commenting over the impact of the Goods and Services tax (GST) with regard to the slowed exports, Joshi said that the new taxation is complicated and it is likely to take time for the traders and exporters to get along the new regime. He however maintained that the GST could factor as one of the reasons behind the fa

Exporters have said their failure to receive goods and services tax (GST) refunds is dragging down the sector. “After paying the GST four months in a row and without receiving any refunds, small and medium enterprises are at a breaking point. There is an immediate need for remedial measures to prevent a further decline in exports,” said Ganesh Kumar Gupta, president of the Federation of Indian Export Organisations. In the GST regime, exporters have to pay taxes on realised profits upfront and then apply for refunds. Source- Business Standard.

The Cabinet on Thursday set the ball rolling for establishment of a national anti-profiteering authority amid reports that restaurants were not passing on the benefits of reduced goods and services tax (GST) rates to consumers. The Cabinet cleared the creation of the posts of chairman and members of the authority, which will ensure consumers receive the benefits of reduced prices in the new indirect tax regime. “This paves the way for immediate establishment of this apex body,” said Union law minister Ravi Shankar Prasad. “The National Anti-Profiteering Authority is an assurance to consumers. If any consumer feels the benefit of tax rate cuts is not being passed on, he can complain to the authority,” the minister added. The GST Council had last week decided to lower rates on about 200 items. It had also reduced the rate on restaurants to five per cent. There have been complaints that some restaurants are not passing on the benefits because input tax credit is not available to t

Supply has been defined as an inclusive definition under GST laws which includes –– 1. All forms of supply of goods or services or both for a consideration include sale, transfer, exchange, rental, lease or disposal made or agreed to be made by a person in the course or furtherance of business; 2. Import of services for a consideration whether or not in the course or furtherance of business; 3. All activities as specified in Schedule I, for without consideration, for e.g. transfer of goods from principal to agent etc. 4. All activities as specified in Schedule II to be treated as a supply of goods or supply of services. 5. All activities or transactions as specified in Schedule III, for e.g. services from employee to employer etc. 6. Such other activities or transactions are undertaken by the Central Government, a State Government in which they are engaged as public authorities shall be treated as a supply of goods or services. 7. The Central Government may, on the reco

Union Finance Minister Arun Jaitley has hinted that reform measures such as the introduction of the goods and services tax (GST) could possibly lead to a deviation from the fiscal road map. “No pause but challenges arising from structural reforms (which) could change the glide path,” a research report from Morgan Stanley quoted the Finance Minister as saying at an event in Singapore. The Centre’s fiscal deficit target for 2017-18 is 3.2 per cent of GDP. According to the recommendations of the Fiscal Responsibility and Budget Management (FRBM) panel, the Centre should aim for a fiscal deficit of 2.5 per cent by FY23. For FY19, it has suggested a fiscal deficit target of 3 per cent. The recommendations are yet to be accepted by the government. The panel has provided flexibility to the government of the day by framing escape clauses to deviate from the fiscal road map by 0.5 per cent for any year under strictly defined circumstances, which include “far-reaching structural reforms i

Angry that the stated benefits of GST have not reached you yet as a consumer? Perhaps it’s the restaurant bill, which hits your pocket just as much as it did when 18 per cent GST was levied on AC restaurants. Maybe it’s regarding the sundry items you need for everyday living. Now, the government has come up with measures to stop businesses from giving you a raw deal. The Union Cabinet on Thursday approved the setting up of the anti-profiteering authority under the Goods and Services Tax (GST) regime in a bid to ensure that the benefit of lower rates is passed on to consumers. The Authority will be composed of a chairman and four technical members. “This paves the way for the immediate establishment of the National Anti-profiteering Authority (NAA) which is mandated to ensure that the benefits of the reduction in GST rates are passed on to the ultimate consumers by way of a reduction in prices,” a Finance Ministry release said here. The NAA is to be headed by a Union government

NEW DELHI: Opening a new chapter in consumer protection, the Union Cabinet on Thursday gave its nod for constituting a National Anti-Profiteering Authority (NAA) to ensure that the full benefits of input tax credits and reduced GST rates on supply of goods or services flow to the consumers. This nod is timely as it comes on the heels of the GST Council announcing tax rate cuts on 178 items from the maximum rate of 28 per cent to 18 per cent. Several items in 18 per cent tax slab have also been lowered to 12 per cent. Over the last three meetings in recent months, the GST Council had reduced rates on about 300 items. This has raised the question of whether the businesses would promptly pass on the benefit of reduced rates to consumers. But, the devil lies in the detail. All eyes, especially those of anxious businesses, are now on the government to see what methodology would be used to decide whether profiteering has occurred or not, say tax experts. Different countries have ado

NEW DELHI: The government is asking consumer goods companies as well as others dealing with over 200 items, where goods and services tax (GST) has been reduced, to immediately pass on the gains to consumers. A senior officer told TOI that with the levy slashed from 28% to 18% for 176 items, including shampoo, washing powder and deodorants, the government expected prices to come down by 8-9%. The official added that the Central Board of Excise and Customs (CBEC) has initiated talks with companies and is also writing to some of the top players. While some of the companies have indicated that the process may take a while, officials said, the price cut should be immediate and should be communicated to the distributions channels. “The transmission should not take more than five or six days. If excess tax has been paid, it will be refunded through tax credits. So, businesses need not worry,” said the tax official, who did not wish to be identified. The decision to reduce the levy was

Introduction 1. With the advent of GST, owing to availability of credit on any goods or services used in business which is widely worded, many avenues of credit have been unlocked. Though the credit pool has been amplified, yet credit is subject to the restricted categories enumerated in the "negative list for credit", namely, Section 17(5) of the Central Goods & Services Tax Act, 2017. One such category, which is expected to be an apple of discord between the department and assessee, is Section 17(5)( h ) wherein credit on "goods lost, stolen, destroyed, written off or disposed of by way of gift or free sample" is barred. The point of focus in this article is "goods lost, stolen or destroyed". Whether credit on GST paid goods eventually lost stolen or destroyed is allowable 2. The moot point is whether the credit of all goods which are purchased on payment of GST and eventually lost, stolen or destroyed is disallowed by this entr

NEW DELHI: Consumers at fast-food chains across the country may not be able to enjoy the full gains of the lower GST rate of 5% that kicked in from Wednesday as many restaurants are raising menu prices, citing the government’s decision to withdraw credit for taxes paid on raw material and rent. Starbucks, McDonald’s and Domino’s Pizza have already hiked the base price, while others like KFC are planning to follow suit by next week. As a result, the actual gain to the consumer may turn out to be minuscule, although the GST Council decided to reduce the levy from 18% to 5% for all restaurants. For instance, GST has come down to around Rs 9 from Rs 28 for a cup of coffee at a popular coffee chain. But the company has increased the base price of the product to around Rs 170 from Rs 155. So, in the end the consumer will have to pay only Rs 4 less instead of a possible Rs 20 gain, if the menu price was not increased. “Following the recent revision in the GST structure, we have ensured

Integrated Goods and Services Tax (IGST) Rules, 2017 as updated till 15th November 2017. Integrated Goods and Services Tax (IGST) Rules, 2017 are Notified vide Notification No. 4/2017-Integrated Tax (Dated 28 th June 2017) and further amended by Notification No. 12/2017-Integrated Tax (Dated 15 th November, 2017) Government of India Ministry of Finance Department of Revenue Central Board of Excise and Customs 1. Short title and commencement.-(1) These rules may be called the Integrated Goods and Services Tax Rules, 2017. (2) They shall be deemed to have come into force on the 22nd day of June, 2017. 2. Application of Central Goods and Services Tax Rules .- The Central Goods and Services Tax Rules, 2017, for carrying out the provisions specified in section 20 of the Integrated Goods and Services Tax Act, 2017 shall, so far as may be, apply in relation to integrated tax as they apply in relation to central tax. Rule 3 below Inserted vide Notf No. 12/20

All states barring Delhi reported revenue losses in October on account of the goods and services tax (GST), requiring Rs 7,500-crore compensation from the Centre during the month. This may not affect the Centre’s fiscal deficit as it will be taken care of by Rs 8,000 crore collected as compensation cess in October. The tax revenue was collected in the month of October and not for October, for which the last date for paying tax is November 20. The Centre’s revenue collection target may come under slight strain after the GST Council last Friday decided to lower. Source- Business Standard.

Last week, GST Council decided to make several changes in GST law in respect of small businesses and particularly the composition scheme. Composition scheme is an alternative method of levy of tax on small taxpayers.  Dealers opting for composition are required to pay tax at a fixed rate without ITC benefit. The basic objective of Composition scheme is to reduce compliance cost for small businesses. Let us have a look at the major changes proposed in composition scheme with respect to traders and manufacturers. In GST, different tax rates are prescribed for different goods (0, 5%, 12%, 18%, ) whereas a composition dealer has to pay tax at a single fixed rate. Till now, composition rate applicable to traders was 1% and that for manufacturers was 2%. But now it has been decided to revise the rate for manufacturers also to 1%. The most important change is that previously 1% composition tax was to be paid on total volume of turnover – whether of taxable goods or exempt goods. But no