prpri 20 Suggestive Tax Relief Measures In Times of Covid 2.0 20 Suggestive Tax Relief Measures In Times of Covid 2.0

Time And Tide Wait for None But Tax collectors Have to Wait This Time

The Covid 2.0 has taken a lot of toll and has wreaked Havoc in 2021. The bugle of war between Human Race and the Virus has already been sounded and this is raging like a war for human survival. In this scenario, the finances need to be put on the backburner and priorities need to be shifted in the aisle.

Some More Relaxations Needed in Covid 2.0 are listed below and the expectations from the Govt is to be more liberal in announcing slew of extensions and for facilitating trade measures:

20 Suggestive Measures In Times of Covid 2.0

1. GST Returns Date Extension:

Gst date extensions have been made previously thinking that this second strain will die down by Mid May and the businesses would be resumed in mid may. But this is not going to happen very soon with as many as 26 states/ UTs under lockdown currently and the lockdowns being extended till 3rd or 4th week of May 2021.

Relief Sought: The GST date extensions for filing GST returns like GSTR 3B, IFF, GSTR 1, ITC 04, GSTR 7, GSTR 5A and other returns to be liberally given till 31st August 2021.

2. GST Tax Deposit date extension:

Currently, only 15 days interest free period given to below 5 crores turnover dealers  and no relief given to dealers above 5 crores turnover. Corona Virus is not segregating dealers as per turnover data and is hitting hard to everyone in its vicinity.

Relief Sought: The GST tax deposit timelines to be extended till 31st July 2021.

3. Reduction in Rate of Interest on deposit of GST:

Currently the FD rate of interest wary between 4.5% to 5.5% on average basis and the savings interest is meager 3.5 to 4% annually. When the penal interest rates of 18% or 24% p.a. were fixed, the FD interest rates used to be in the range of 9-10% and savings interest rate was between 6-7%. The income rates have been halved but the expense interest rates are still the same 18% or 24%.

Relief Sought: The interest rates need to be rationalized keeping in view the current bank Fd/ savings interest rates.

4. GST input benefits for Covid related set ups, covid related expenditures:

The Govt has taken various steps in exempting Customs duty on import of covid related relief material. The industry need the encouragement for Gst input benefits for procuring ambulances for charity or employees sake. Some small and medium sized businesses have taken up to charity and purchased an deployed ambulances for the benefit of the staff personnel and kept mini hospital set ups ready by providing oxygen kits at bay.

Relief Sought: Itc to be allowed as above.

5. Rule 36(4) conditions to be cumulatively relaxed till 31st July 2021.

The Govt has given relaxations for Rule 36(4) condition for the month of April and May 2021 only. The pandemic has altered the pace, fabric and nature of our lives in a big way. The industry need relaxations in following this rule in case of non or late filing of Gstr 1s by the suppliers.

Relief Sought: Rule 36(4) to be relaxed till 31st July 2021 and to be cumulatively applied in GST return of August 2021.

6. Payment within 180 days:

The finances are already under crunch and calls for relaxation in this rule so as to minimize the costs and burden on the already bleeding industries.

Relief Sought: Relaxation requested as above till 31st July 2021.

7. IGST exemption on purchase of Covid relief material even for Personal Use:

The Govt has vide IGST Adhoc Exemption order exempted IGST on import/ purchase of Covid relief material by State designated agencies subject to fulfillment of certain conditions. Import of covid relief material for personal use calls for Igst exemption too.

Relief Sought: IGST exemption as above.

8. GST exemption on vaccines with simultaneous ITC allowed on input goods and services:

GST exemption to be given on production and distribution of vaccines with ITC allowance on its production and distribution otherwise the cost is going to increase for the manufacturers/ distributors.

Relief Sought: GST exemption on output side with ITC allowance on input side till 31st March 2022 to be given keeping in view the target of vaccinating the whole Indian population.

9. TDS deposit dates to be extended:

The date for deposit of Tds u/s 194IA, 194IB and 194M had been extended till 31th May 2021. The industry needs blanket exemption on deposit of Tds under all sections with offices closed, the accounts team staggered and everyone fighting their own battles.

Relief Sought: Tds deposit dates to be extended till 31st July 2021 under all sections for March 2021 and for the months of April, May, June 2021- the dates to be extended till 31st August 2021.

10. TCS/TDS returns date also need extension:

TCS return date is hovering being 15th May 2021 and Tds returns as 31st May 2021 for the Quarter ending Jan to March 2021.

Relief Sought: The Tcs and Tds return dates need to be extended till 31st August 2021 and for the First Quarter 2021-22 to be 30th September 2021.

11. TCS/TDS certificate generation dates:

As per point 9 and 10 above, the TDS and TCS certificates download dates also need to be extended till 15th September 2021 for Q4 and 15th October 2021 for Q1 2021-22.

Relief Sought: Relaxation As above

12. Belated/Revised ITRs of asstt year 2020-21 need to be extended:

In the light of prevailing circumstances, the date need to be revised till 30th June 2021 so that the real benefit percolates down under for whom the date was extended earlier.

Relief Sought: The date needs extension till 30th June as above.

13. Income tax And Audit returns for Asstt year 2021-22:

With this fight not being a one-time measure and rather it is looking like a sustained measure In the months to come, the Income tax date extensions would be required in the near future to 3 months from the original dates as envisaged in the sections.

Relief Sought: The date would be requiring extension keeping in view that everyone was caught off guard in one way or the other.

14. IEC updation till 30th June 2021 need extensions:

Relief Sought: IEC code updation as originally envisaged need to be extended till 31st July 2021.

15. Relaxation in Advance tax for the first quarter 2021-22:

Relief Sought: With industry already bleeding profusely, first installment of advance tax deposit to be merged with second installment 15th September 2021.

16. Section 54 and related time line extensions:

For all those who are waiting for investment within 2 years or 3 years in immovable property as per Section 54 and 54EC, the months from March till June 2021 not to be counted in those time lines.

Relief Sought: The timeline need to be extended as above.

17. SFT and Equalization Levy Form 1 submission needs extension:

Deposit of Equalization levy for the months of March, April, May, June 2021 need extension and the statement time line need to be extended till 31st July 2021

Relief Sought: The timeline need extension as above.

18. PF/ ESI deposit date extension:

PF and ESI contribution by employer and employees foe the month of March, April, may, June 2021 need to be extended without penal interest till 31st July 2021

Relief Sought: The time line needs extension as above.

19. Section 269ST to be relaxed on general hospitalization also:

Section 269ST to be relaxed in case of general hospitalization too. In case, the patient is on death bed, such stringent rules need to be relaxed.

Relief Sought: Exempt emergency services from Section 271DA penal provisions.

20. CFSS 2020 need to be brought back for 1-2months:

Similar on the lines of giving relief for filing belated returns for Asstt year 2020-21; the CFSS scheme to be brought back may be for a shorter term period for those who missed the bandwagon due to Covid.

Relief Sought: Time line to be extended as above.

The Corona Wave has taken the nation by surprise and the Covid trend predictions says the current second wave could peak maximum within 15 days from here on. The businesses will take another 30-40 days to return to normalcy and hence liberal time line extensions as were provided in Covid 1.0 are the need of the hour in Covid 2.0.

Disclaimer: The contents of this article are for information purposes only and do not constitute an advice or a legal opinion and are personal views of the author. It is based upon relevant law and/or facts available at that point of time and prepared with due accuracy & reliability. Readers are requested to check and refer relevant provisions of statute, latest judicial pronouncements, circulars, clarifications etc before acting on the basis of the above write up.  The possibility of other views on the subject matter cannot be ruled out. By the use of the said information, you agree that Author / TaxGuru is not responsible or liable in any manner for the authenticity, accuracy, completeness, errors or any kind of omissions in this piece of information for any action taken thereof. This is not any kind of advertisement or solicitation of work by a professional.

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  1. Sunil fattepuria says:

    Realy covered all issues 9 n 9c penalty waiive since 2017 many clients remain to file due to new act n faceing covid 19 pl add the point

  2. v.v.v.sekar says:

    1. good that you have covered widely.
    2. In income tax and TDS the following should be noted.
    a. arrears are mentioned for the old period prior to computerisation. No basic document is provided for arriving at the balance due. Due back documents to be presented in the website as attachment for old periods for which computer details are not available. In many cases the assesses do not receive order copy and surprised to find a demand for the year 2002 for Rs. 12,000 with interest calculated upto 2021 amounting to Rs. 24,000. When we ask for order copy, the same is not produced. When there is any demand, the order on which the demand is raised should be available to the assesses.
    2. Should take steps to interact and collect arrears.
    3. In PF the interest charged for arrears beyond 180 days is around 36%( may be slightly different). The short payment is informed by the department after 3years and interest is charged at 36%+ penalty. When everything is computerised, why the department is not taking action for collecting within 3 months. May be welfare scheme to the employees but not to the employer.
    4. Unmatched incometax and TDS payment challans are now listed by the computer center. The department should return back the amount on voluntary basis with interest to the assesses. All these are double payment made by the assesses who did not report the payment to the department.

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