The GST law implemented from 1st July 2017 in India and approaching to 9 years as of now. During this period 55 GST Council meetings conducted and issued several notifications, Circulars, explanatory notes to the business community. Each and every council meeting they will bring several notifications, circulars, explanatory statements which were not dealer friendly to the dealers. Prior to the GST period, Central Government of India declaring the changes in tax structure during the Budget announcement only. But now changing this scenario in frequent intervals creates lots of practical difficulties to the business community.
In the case of Government contractors, they are also facing the same type of difficulties. Now a days they are getting the contract amount through Bill Discount Systems. But the invoice value that will come to know after the measurement taken and put it in the E book and upload the same in Government portal by the Government Officials. So the changes in GST law not being updated by the Government portal and its system.
As per Sec 51 & 52 of CGST Act, if any purchase order or contract value exceeding 2.5 lakhs, Government authorities shall deduct/recover TDS & TCS @ 2% & 1% respectively. This amount deducted has to be remitted to Government in time by filing GSTR- 7.Delaying the same the contractors will definitely face the difficulties to claim the ITC. TCS collecting @1% from the customer through E- commerce operators should report to the same in GSTR -8.
The GST rate for the government contractors has been revised from 12% to 18% after 18th July 2022 under Notification No. 15/2021. When this rate enhanced contractors lost the opportunity of refund under inverted tax structure.
When we started the GST regime, the slogan was “one country one tax” now this reached “one country 7different tax rates.
As in the case of advance receipt, tax payers have to remit GST under RCM towards the service when they are collecting such advance but this concept not applicable in the case supply of goods. This anomoloy is to be streamlined.
Different types of audit are conducting by the Central and State GST Officers which create lots of confusions in business sector.
Those who are filing the return in time and keeping books in the right manner getting the notices under section 74.A tax payer keeping his accounts in correct format it cannot be treated as a fraud case under Section 74 of GST Act.
Those who filed late return, they cannot avail amnesty scheme and the same time they have to remit the tax, interest, penalty etc without any concession. So we can clearly say that the Amnesty Scheme announced by the Government had lots of limitations. So the Amnesty Scheme should be declared again for at least 4 years from the GST regime commencement of 2017.
When the Government is making delay in releasing the refund interest @ 6% is granted. However when demands are created by the department, they are charging interest @ 18%.Similarly tribunal even though notified it is not started functioning. Hence tax payers has to approach Hon. High courts to get stay/relief when the first appeal before the authority getting disallowed. In such circumstance huge amount is blocked in the hands of Central and State Governments.
A few proposals are listed below which can be considered in the ensuing GST Council Meetings and also can be take care in Union Budget.
1.In the case of builders existing rate of compounding rate @ 1% for affordable residential units and @ 5 % for others. In addition to above non – compounding method also to be implemented @ 12% with eligibility of taking ITC for their purchase of goods and service.
2. Change in the tax rate should be implemented only when government budget is announced.
3. Avoid bill discounting system for government contractors sector and implement running account bill system.
4. Return should be filed by the Department when TDS & TCS are deducting in time.
5. At present when there is a mistake in GSTR1 it can be rectified through GSTR1A before filing GSTR3B of the same month. In short tax payer getting only 9 days to rectify such mistakes, which is too short. Hence a minimum period of 3 months for correcting the mistake occurred in GSTR1 filing can be allowed.
6. Functioning of Tribunal in GST law is still pending and tax payer not able to file the appeal. At present a 2 member bench is in existence in which an Accounts member is not available. It can be considered to form a 3 member bench in Tribunal.
7. GST amnesty scheme may be reintroduced and eligibility can be extended upto 4 years, ie 2017 to 2021
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