How Assessment Under GST is Different from PRE-GST Assessments

The very word ‘Assessment’ may be depressing, but true as taxes are on everyone’s mind almost 24-7 since they influence our daily lives.

In respect of indirect tax, it is the process of calculating how much someone must pay, or the amount that must be paid.

The invention of GST is the result of tax rates are too high and tax revenues are too low for both the centre and state, and the soundest way to raise the revenues in the long run is to cut the tax rates.

This could be evidently seen from the news clippings dt 1^st February 2019:

GST collections cross Rs 1 lakh crore in January 2019: Finance Ministry

“GST collections have jumped to Rs 1 lakh crore in January this year from the Rs 94,726 crore collected in December last year, Finance Ministry said today. This has been a significant improvement over collection of Rs 94,725 crore during last month and Rs 89,825 crore during the same month last year. Final figures and details of collections for the entire month will be intimated on February 2, the ministry said in a statement.

“This increase has been achieved despite various Tax Relief measures implemented by the GST Council to lower the tax burden on the consumers,”

How Assessment different under GST regime over Pre-GST regime.

Various Assessments under the earlier Central taxes and duties such as Excise Duty, Service Tax, Counter Vailing Duty (CVD), Special Additional Duty of Customs (SAD), central charges and cesses and local state taxes, i.e., Value Added Tax (VAT), Central Sales Tax (CST), Octroi, Entry Tax, Purchase Tax, Luxury Tax, Taxes on lottery, betting and gambling, state cesses and surcharges and Entertainment tax (other than the tax levied by the local bodies) are replaced with one assessment under GST, covered by Rule 98 to 100 of CGST Rules 2017. The entire process of assessment from issue of notice to assessment order and its acceptance or rejection of application are covered by just GST assessment forms 1 to 18.

WIN-WIN situation for the stake holders under GST

GST is governed by mother Acts called Central Goods and Services Tax Act 2017, Integrated Goods and Services Tax Act, 2017 and State/UT Goods and Services Tax Act, 2017 in contrast to various laws enumerated in Pre-GST regime.

Following are the major enablers eliminating the cumbersome assessment process gone through under PRE-GST regime:

• Availability of centralised data base: Returns filed online in GSTN portal has access to both Centre and state tax authorities. Various forms used for this purpose in Pre-GST regime is totally eliminated.
• PAN based Registration: Access to data and information from the Income tax files like form 3CD, Indirect tax payment, late fees and penalty, allowable business expenditure under section 37, Payment of liability under section 43B, set-off with ITC, Dis-allowance of expenditure of personal nature as per financials etc.
• No escaped Turn over: As tax base is common to both state and central tax
• Uniform threshold limits: Different limits under different laws in pre-GST eliminated under GST.
• Cross reference to other laws: GSTN enables access control over other data base portals like customs, DGFT etc for obtaining data without bothering the tax payers
• Retrieving of data by tax payers and tax consultants: As electronic data is available in GSTN portal, the tax payers can always refer the relevant data base while replying to communication involving audit, assessment and appeals
• GSTN access to AG audit for functional audit, Banks and RBI for payments, etc
• Not but not the least Refund claims: The refund claims are assessed online with the least manual intervention.

“GST is WORK -IN-PROGRESS”

Would conclude the article from the famous quotes of Bill Archer: “We must care for each other more, and tax each other less”