GST Council Meet: Simple Return Filing to Digital Pay Incentive

CA Ankita Mathur

In its 27^th GST Council meeting held on 4 May, 2018, it was decided to roll out in six months a new simpler process of filing monthly returns. A decision to take complete ownership of GSTN by acquiring the equity share held by non-government institutions was also taken.  A few major decisions taken by the Council are summarised below:

1. Return Simplification: The council approved filing of new single return based on recommendations of ministers on simplifying returns. The key points of new method of return are:
   1. Single monthly return for all the taxpayers except composition dealers and dealers having NIL return.
   2. Method of uploading of invoices by the supplier on anytime basis during the month which can be seen by the buyer on real time basis and can avail Input Tax Credit simultaneously.
   3. Automatic calculation of tax liability and Input Tax Credit by the system on basis of invoices uploaded by B2B dealers. Moreover, a simple and user-friendly IT interface will be provided to Taxpayers.
   4. No automatic reversal of credit from the buyer in case of non-payment of tax by seller to the GST department. In case of default in payment of tax, recovery will be made from seller and authorities will be having an option to reverse credit for buyer in exceptional situations.
   5. Robust, online and automated process for recovery of tax or reversal of Input Tax Credit by issuing notice to reduce human interface on the portal.
   6. Ceasing or preventing suppliers in uploading invoices who has defaulted in payment of tax above a threshold limit to control misuse of Input Tax Credit.
   7. There will be a Stage wise transition for this new system. In first stage, GSTR3B and GSTR1 will continue for 6 months. After that in stage 2, dealer will be constantly fed with the gap between credit available to them as per invoices uploaded by seller in GSTR 1 and provisional credit claimed. And finally, after 6 months of Stage 2, facility of provisional credit will be withdrawn and credit will be limited to invoices uploaded by the seller.
2. Promoting Digital Transactions: Council recommended a deduction in rate of 2% GST (where GST rate is 3% or more) on B2C supplies where payment is made through cheque or digital mode for ceiling of Rs 100 per transaction
3. Imposing Sugar cess over 5%: The council discussed issue of imposition of sugar cess over 5% and reduction in GST rate on ethanol.

This single and simplified return proposal by the government is a welcome move for the taxpayers which will ease out the process of filing of GST returns.

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CA Ankita Mathur (business services-H&R Block India Private Limited), author of this article, can be reached for assistance regarding GST compliant invoicing at ankita.mathur@hrblock.in.

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