Dr. Sanjiv Agarwal, FCA, FCS
On 1st July 2018, GST in India completes first year of implementation. Goods and Services Tax was launched on the 1st July, 2017 in a majestic ceremony held in the Central Hall of Parliament on the midnight of 30th June, 2017. The first year has been remarkable both for the sheer variety of challenges that implementation of GST has thrown up and for the willingness and ability of policy makers and tax administrators to rise up to these challenges and respond befittingly. But more importantly, the first year of GST has been an example to the world of the readiness of the Indian taxpayer to be a partner in this unprecedented reform of Indian taxation. Accordingly, it was decided by CBIC that the 1st of July, 2018 shall be commemorated as “GST Day”.
Before implementation of Goods and Service Tax (GST), Indian taxation system was a mix of central, state and local area levies. In the constitutional scheme, taxation power on goods was with Central Government but it was limited up to the stage of manufacture and production while States had power to tax sale and purchase of goods. Centre had the exclusive power to tax services. This sort of division of taxing powers created a grey zone which led to legal disputes since determination of what constitutes a goods or service became increasingly difficult.
GST collection in last month of first year of GST i.e. June, 2018 is reported to be Rs. 95,610 crore. The breakup of Rs. 95,610 crore is CGST Rs. 15968 crore, SGST Rs. 22,021 crore, IGST Rs. 49498 crore (out of which Rs. 24,493 crore from imports) and compensation cess Rs. 8,122 crore. Thus, in first quarter of current fiscal 2018-19, total GST collection is Rs. 2.93 lakh crore. This brings the total GST collection during first year of GST in India to Rs. 10.34 lakh crore. The tax payer’s base has also expanded in GST regime to over 70 lakh as against 64 lakh is 2016-17 whereas average tax collection has gone up from Rs. 81 lakh crore to Rs. 91.38 lakh crore in GST regime. GST has improved tax revenue as well as tax compliance. Not only this, GST has been helpful in increasing income tax returns and direct tax revenue as well.
Collection of GST revenue w.e.f 01.07.2017-30.06.2018
| Tax for the Month | Revenue (crores) |
| July, 2017 | Rs. 93,590/- |
| August, 2017 | Rs 93,029/- |
| September, 2017 | Rs 95,132/- |
| October, 2017 | Rs 85,931/- |
| November, 2017 | Rs 83,716/- |
| December,2017 | Rs 88,929/- |
| January,2018 | Rs 88,047/- |
| Febuary,2018 | Rs 89,264/- |
| March, 2018 | Rs.1,03,000/- |
| April, 2018 | Rs. 94,016/- |
| May, 2018 | Rs. 95,610/- |
| June, 2018 | Collection figures NA as not due |
Journey in numbers so far
| Number of Taxes (CGST/IGST/SGST/UTGST) | 4 |
| Number of cess | 1 |
| New registration approved | 47,94,828 |
| Number of migrated taxpayers | 63,76,767 |
| Number of notifications issued | 334 |
| Number of circulars issued | 53 |
| Number of press release issued | 170 |
| Number of GST Council meeting | 27 |
| Number of returns filed till date | 12 crores |
| Number of Invoices processed | 380 crores |
| Number of payment transactions | 4.03 crores |
Despite all good features of GST, India GST suffers from many infirmities viz, number of returns and frequency of filing such returns, more tax slabs than desirable, distortions in tax rate via compensation cess, one nation – one tax could not actually happen, fragile and weak GST network and so on…… the list could be long.
If we analyze the inflation, though there is rise in general inflation in the country during GST regime, it cannot be solely attributed to GST. It is difficult to establish that GST has led to inflation so much so that all the three cases of anti-profiteering adjudicated so far have gone in favour of taxpayers.
No doubt troubles are there, it is hoped that with the concerted efforts of Government and honest feed back by the trade, industry and other stake holders, GST can be expected to evolve as a efficient tax system in future. In the give set of Circumstances, GST will continue to be simplified, rationalized and improved upon.
After one year now, simplification of GST returns is being worked out and it is hoped that by this year end, we may have simplified as well as single GST return forms. Also, Government is expected to make change in the GST law which are essential for tax payer’s facilitation.
High tax on items which do not yield much revenue may be lowered. Presently more of tax is coming from handful of items and bulk of items yield a lower tax revenue. GST slab rates can also come down to three (presently four – 5, 12, 18 and 28 percent).
GST Council meeting is expected to meet for 28th time in last one year on 21 July, 2018. While it is expected that GST procedures and implementation concerns are going to be simplified in next one year in the wake up of general elections in few states and Lok Sabha election in May, 2019, GST Council may dwell upon reduction of rates on few items from 28% to 18% and 18% to 12%, reduction in number of tax rate slabs, enlargement of scope of GST so as to include some petroleum products, real estate and ease of filing returns including simplification for composition dealers etc.
Author Bio
To ADD- For drawing pointed attention to the input-comment posted @https://taxguru.in/goods-and-service-tax/taxation-builder-developer-rajasthan-part-1.html/comment-page
OFFHAND (to share instant thoughts, for the “common good”)
It would have been appreciated, and been of helpful guidance, had the learned author, a qualified CA and CS, in field practice, made at least a brief mention of/highlighted the prevailing uncertainties wrt the GST levy on ‘deemed works contract’ (‘DWC’). As of date, such a levy is undeniably in a state of absolute flux.
As regards the host of data provided on ‘tax collections’, no knowing how the recent Notification , issued midstream so to say, deferring the TDS and TCS collections of CGST to end September 2018, is going to impact , retrospectively as well. To be precise, does that not have larger implications and give rise to difficult issues, especially in cases in which taxes have already been collected but remain to be paid over to the government.
Particularly, it is of most concern, in those cases in which the concerned players in ‘realty’ sector, who , for own but unknown reasons- unwittingly- are heard to have gone ahead , in a cavalier and adventurous fashion, with demand and collection of taxes of the still disputed levies on ‘DWC’. Again, the grave doubt is , in the interim, amounts collected by the realtors, prematurely and pre-emptively , without the authority of the law – could not presumably have been paid, but are lying with them , in a suspense account.
As independently viewed, this is an aspect which must have been of every concern to CAs engaged for audit, so also the CSs employed /engaged as Secretary cum Compliance Officers, by those realtors.
In short, in view of the obviously inevitable far reaching consequences, by any thinking, for the benefit of its own members,- apart from taking care of the concerns of the stakeholders,- mainly the purchasers’ community, – both the regulatory bodies are supposed to have come out with proper and adequate guidelines to be uniformly followed. In case not done as yet, better done down now, than later or never.
Courtesy