Dr. Sanjiv Agarwal, FCA, FCS
It the 27th meeting held on 4th May, 2018, GST Council, the high powered Constitutional body to take decisions on levy and administration of Goods and Service Tax in India considered various issues and concerns and made recommendations. These recommendations are subject to detailed consideration by Group of Ministers or other bodies and shall be implemented in due course.
GST Council inter alia, made the following recommendations in its last meeting held on 04.05.2018:
♦ Towards Simplification of returns:
Government is keen to introduce the simplified return design at the earliest to reduce the compliance burden on the trade in keeping with the philosophy of ease of doing business. Returns shall be simplified also by reducing the content/information required to be filled in the return. The details of the design of the return form, business process and legal changes would be worked out by the law committee based on these principles. Government is keen to introduce the simplified return design at the earliest to reduce the compliance burden on the trade in keeping with the philosophy of ease of doing business.
Council approved the principles for filing of new return design. The key elements of new return design are as follows:
√ Stage I: the present system of filing returns, which suppose to continue for period not exceeding 6 months.
√ Stage II: New invoice wise return facility and claiming of ITC on self declaration basis.
√ Stage III: After 6 month of phase II, the facility of claiming ITC on provisional basis will get withdrawn and input tax credit will only be limited to invoices uploaded by seller from whom dealer had purchased the goods.
♦ Incentive to promote of Digital Transaction
♦ Imposition of Sugar Cess over and above 5% GST and reduction in GST rate on Ethanol:
The Council discussed the issue of imposition of sugar cess in view of record sugar production, consequent depressed sugar prices and buildup of sugar cane arrears, and reduction in GST rate on ethanol and recommended to set a new Group of Ministers from State Governments to provide recommendations within two weeks. There is no levy of sugar cess for the time being.
♦ Change in the Shareholding Pattern of GSTN
The Goods and Services Tax Network – Special Purpose Vehicle (GSTN-SPV) was created as a private limited, not-for-profit company under Section 25 of the Companies Act, 1956 (Section 8 of the Companies Act, 2013) with an objective to provide shared IT infrastructure and services to Centre and States Governments, tax payers and other stakeholders for implementation of Goods and Services Tax (GST) in the country.
Acquisition of entire 51% of equity held by the Non-Governmental Institutions in GSTN amounting to Rs. 5.1 crore, equally by the Centre and the States governments and allow GSTN Board to initiate process for acquisition of equity held by the private Companies; and GSTN Board shall be allowed to continue the existing staff at existing terms and conditions for the a period upto five years, and shall have the flexibility of hiring people through contract on the terms and conditions similar to those used by GSTN till now while hiring regular employees.
As a caution, readers are advised that the above recommendations shall be implemented after final decision of the Council and Notification thereof.