It is expected by various agencies that GDP may fall in majority of major economies amid covid crisis. In Q2 of 2020-21, India may be one of the slowest growing economies. In Q1, India’s growth has fallen the steepest among G-20 nations.
Although markets have responded positively to the vaccine news, rising cases of Covid in second /third was can have an adverse impact. However, increase in e-way bills and GST collections defy such a belief, as of now. According to Dr. C. Rangarajan, noted economist and former RBI Governor, economy may be back on pre-Covid levels by 2021-22 end as the signs of economic recovery are visible after series of unlock down phases.
MOF also expects economy to pick-up and it may also announce next tranche of stimulus. India stands poised to re-cover at a fast pace and reach pre-Covid levels by the end of the year- barring the incidence of second wave that may be triggered by the fatigue with social distancing.
On Compensation Cess, Pondicherry, West Bengal, Kerala and Rajasthan have accepted the proposal of borrowing as per Central Government proposal – Option-1. With this, 25 States and 3 UT’s have given nod for option-I for meeting GST Compensation Cess shortfall. States like Punjab, Jharkhand and Chhattisgarh are yet not decided on this. The centre has already borrowed and transferred Rs. 24000 crore in four tranches to opting states and 3 UT’s.
CBIC had issued a series of Notifications on 10.11.2020 (from Nos. 81 to 88) and Circular No. 143, all dated 10.11.2020. Notification Nos. 81 to 84 relate to implement the scheme of quarterly return filing alongwith monthly payment of taxes (QRMP scheme). A clarificatory circular has been issued to clarify the issues of eligibility, options, furnishing of details of outward supplies u/s 37 of CGST Act, 2017, monthly payment of tax, quarterly filing of Form GSTR-3B,applicability of interest and late fees. Further, time limit for filing of form GST ITC-04 has been extended to 30.11.2020. E-invoicing has been made mandatory from 01.01.2021 for every taxpayer whose aggregate turnover in any financial year from 2017-18 exceed Rs. 100 crores.
While no new notifications has been issued in last 10 days, Corrigendums were issued to Notification Nos. 82 and 86, both dated 10.11.2020. GSTN has been issuing clarifications and updates on various GSTN functionalities and procedures such as e-invoicing for taxpayers with Rs. 100 crore turnover, FAQ’s on e-invoicing, blocking of e-way bills (EWB) generation facility from December, 2020, auto population of e-invoice details in GSTR-1 etc. The drive to detect fake invoices and wrong ITC continues with more and more cases being booked and arrests being made.
On GST collections, post lock-down due to Covid, economy has started opening up and so the tax collections are also on a rise. GST collections started rising from July, 2020 onwards and have been in a range of Rs. 87000 – 105000 crores. In October 2020, GST collected crossed Rs. one lakh crore and was Rs. 105155 crore. While November, 2020 GST collections may also show + 1 lakh crore due to festive demand push, it may be difficult to sustain it in near future.
For effective growth, one should look at YoY growth. If all estimates and growth prediction indicate a contraction of 10-12%, the GST collections in 2020-21 are likely to be lower only. The next wave of Covid entering India is also a course of worry, though our economy has been recovering at a reasonable pace. E-invoicing which was introduced from October 1, may also help in enhanced taxes in subsequent months.
Recently 15th Finance Commission’s Chairman has stated that GST in India is not a perfect tax system though a path breaking reform and it requires changes alongwith rates rationalization. He has also suggested for getting rid of exemptions and improving quality of technology and invoice matching.
The Central Government has appointed the 10th day of November, 2020, as the date from which amendments in the provisions of section 39 (1, 2 and 7) made by Finance Act, 2019 of Act shall come into force. These amendments relate to furnishing of returns under QRMP Scheme.
Following amendments have been made in CGST Rules, 2017 in relation to returns (Rule 59, 60, 61, 61A and 62)
The invoices reported in IFF shall be made available to recipient in their GSTR-2A/2B
|Details of invoices furnished by||FORM||Part of FORM GSTR 2A|
|Non-resident taxable person||GSTR-5||Part A|
|Input Service Distributor||GSTR-6||Part B|
|Tax deducted at source||GSTR-7||Part C|
|Tax collected at source||GSTR-8||Part C|
|Integrated tax paid on the import of goods or goods brought in domestic Tariff Area from Special Economic Zone unit or a Special Economic Zone developer on a bill of entry||Part D|
New due dates for filing form GSTR-1 have been notified w.e.f. 01st January, 2021
|Monthly / Quarterly||Due Date|
|Monthly||11th of the succeeding month.|
|Quarterly||13th of the succeeding month.|
√ Turnover upto 1.5 cr and GSTR-1 on Quarterly basis in CFY- Quarterly
√ Turnover upto 1.5 cr and GSTR-1 on Monthly basis in CFY- Monthly
√ Turnover more than 1.5 crore rupees and up to 5 crore rupees in the preceding financial year- Monthly
The registered person may change the default option electronically, on the common portal, during the period from the 5th day of December, 2020 to the 31st day of January, 2021.
This is effective from 01.01.2021.
(a) for the first month of the quarter, where the balance in the electronic cash ledger or electronic credit ledger is adequate for the tax liability for the said month or where there is nil tax liability;
(b) for the second month of the quarter, where the balance in the electronic cash ledger or electronic credit ledger is adequate for the cumulative tax liability for the first and the second month of the quarter or where there is nil tax liability:
Notification No. 76/2020- Central Tax dated 15.10.2020 relating to GSTR-3B for October, 2020 to March, 2021 has been rescinded w.e.f. 10.11.2020.
The time limit for furnishing the declaration in FORM GST ITC-04, in respect of goods dispatched to a job worker or received from a job worker, during the period from July, 2020 to September, 2020 has been extended till the 30th day of November, 2020.
The Notification No. 87/2020-Central Tax shall be deemed to have come into force with effect from the 25th day of October, 2020.
Amendment has been made in Notification No. 13/2020-Central Tax dated 21.03.2020 relating to GST e-invoicing vide which the requirement of GST e-invoicing has been extended to tax payers having aggregate turnover exceeding Rs 100 Crore in any of the last three financial years, viz FY 2017-18, 2018-19 or 2019-20.
This will be applicable with effect from 1st January, 2021.
[Source: GSTN dated 13.11.2020]
This ‘enablement’ is primarily to ensure only the notified taxpayers (and not any taxpayer at their option) are able to register and test reporting of invoices on the portal. The enabled taxpayers however need to register again on the portal.
This listing of GSTINs is solely based on the turnover of GSTR-3B as per GST System. It may contain exempt entities or those for whom e-invoicing is not applicable for some other reason.
Note: The enablement status on trial portal or production portal (IRP) doesn’t mean that the taxpayer is supposed to do e-invoicing. If e-invoicing is not applicable to a taxpayer, they need not be concerned about the enablement status and may please ignore it.
[Source: GSTN dated 17.11.2020]