10 points to summarize budget proposals of GST

Top 10 updates of GST from the Finance bill, 2019 includes Interest for delay in payment to be made only on the tax to be paid in Cash, Cash ledger optimisation – Enabling transfer of the balances among the CGST, SGST & IGST, Enabling the single window refund mechanism, Moving from PAN based reg,n to Aadhaar based reg, Digital payment facility to be provided to the customers – Mandatory for certain class of suppliers, Enabling the new Monthly/Quarterly/Annual returns, 10% of the profiteered amount shall be levied as penalty for Anti-profiteering cases, Constitution of “The National appellate authority for advance ruling”, Composition scheme – changes made through Orders / Notifications are incorporated in the act and Drawing the powers from the act to make the changes as and when required, by way of Notifications / Orders.

1) Interest for delay in payment to be made only on the tax to be paid in Cash

i. In case of delay in filing of returns, it is enough to pay the interest on the tax paid using the balance of cash ledger (i.e. Total liability – paid through credit).

ii. The above shall not be applicable if the returns are filed in accordance with the proceedings of the department under Sec-73/74.

{Refer Sec 99 of Finance bill}

2) Cash ledger optimisation – Enabling transfer of the balances among the CGST, SGST & IGST

i. The registered persons shall be allowed to transfer the cash balances among CGST, SGST & IGST

ii. The amount transferred shall be deemed as the amount refunded under that act – Sec 49(10)

{Refer Sec 98 of Finance bill}

3) Enabling the single window refund mechanism

The central govt. has drawn power to disburse the state taxes by inserting new sub-sec. 8A to Sec 54. The similar amendments shall also be made in State GST acts.

Hence, the Central/State officer processing the refund claim can disburse the entire tax (CGST=SGST+IGST) amount at a time.

{Refer Sec 102 of Finance bill}

4) Moving from PAN based reg.n to Aadhaar based reg.n

i. Existing registrations:

All the person should get the Aadhaar authentication done within the given time, otherwise the reg.ns may get cancelled. – Sec 6A

ii. New registrations:

Reg.n shall be granted only after authenticating the Aadhaar details. – Sec 6B & 6C

iii. If the Aadhaar is not available, alternative ways shall be prescribed.

Note: For other than individuals, the Aadhaar details of the individuals added in the reg.n applications should be authenticated.

{Refer Sec 94 of the finance bill}

5) Digital payment facility to be provided to the customers – Mandatory for certain class of suppliers

i. The govt. shall prescribe the class of persons, who should mandatorily provide facility for digital payments to their customers – Sec 31A

{Refer Sec 95 of the finance bill}

6) 10% of the profiteered amount shall be levied as penalty for Anti-profiteering cases

i. If the authority has concluded that regd. person has profiteered, such person shall be liable to pay penalty @10% of the profiteered amount

ii. No such penalty shall be required, of the amount is deposited within 30 days from the date of passing the order

{Refer Sec 111 of the finance bill}

7) Enabling the new Monthly/Quarterly/Annual returns

i. Sec-39 was amended to provide for the new return mechanism for the regd. persons under the Regular and composition scheme.

ii. The govt. is also empowered to notify the class of persons to follow different mechanisms

{Refer Sec 96 of the finance bill}

8) Constitution of “The National appellate authority for advance ruling”

i. The existing definition of the “appellate authority for advance ruling” has been amended as “The National appellate authority for advance ruling” by amending 2(4);

ii. Constituting the same, defining the composition, procedures, timelines, conditions. etc – New sections 101A, 101B and 101C

Corresponding changes required for the wording of other sections made by amending respective sections – Sec 105, 107, 108 & 109

Specified that the rulings of such authority shall be binding on all the registered persons having same PAN and on all the officers dealing with the GSTINs of such persons – Sec 106 (1A).

{Refer Sec 91 & 104-109 of Finance bill}

9) Composition scheme – changes made through Orders / Notifications are incorporated in the act

i. Exclusion of value of interest/discount received on loans/deposits from the aggregate turnover for evaluating the eligibility of composition scheme, provided by ROD 1/2017_13-Oct-17 is now inserted in the act.

ii. Restrictions for Casual and Non-resident taxable to opt for composition scheme specified in Rule 5(a) has been insert-ed in the act by inserting a proviso to Section 10(2)

iii. 6% scheme provided by way of notification 2/2019 CTR is inserted in the act by inserting new sub section-10(2A)

{Refer Sec 92 of Finance bill}

10) Drawing the powers from the act to make the changes as and when required, by way of Notifications / Orders:

i. To increase of threshold limit for registration up to 40Lacs up on the request of the state – Proviso to Sec 35

ii. To extend the due date for filing the annual return – Proviso to Sec 44(1)

iii. To extend the due date for monthly returns / Annual statements by the person collecting tax at source – Proviso to Sec 52(4) / 52(5)

{Refer Sec 93, 97, 100 & 101 of Finance bill}

Source: Finance bill (2),2019

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Disclaimer:

This document had been written to provide updates under GST in a simple manner. The author shall not be responsible for any of the decision made based on the contents of this document.