Article discusses Practical Problems Faced by GST Return Filers which includes Technical Issues, Problems Related to ITC, Problems Related to Returns, Problems relating to E Way Bill Generation, Problems relating to Scrutiny (Minor to Major difference between GSTR 3B and GSTR 1, GSTR 3B and GSTR 2A), Problems faced by Small Businesses and Problems faced by the Professionals like like Chartered Accountants, Cost Accountants and other GST Practitioners.
GST Website is structured properly with simplest and easiest interface for the users; however, the focus is too much on appearance rather than functionality.
As many of the Registered users find it difficult to overcome the bugs and glitches which many a times results into penalties and late fees.
New online facilities are constantly updated on the GST Portal, however most of them lack proper execution when brought into effect. For example, Online GST Refund, LUT or Bond Application and many more. Also, the Grievance Redressal mechanism is not helpful in majority of the cases as the problem solvers are themselves not aware of the solutions.
With complex rules in force, calculation of Input Tax Credit on monthly basis is a big and tedious task. Rules relating to claiming and reversal of Input Tax Credit on Capital Goods,
Rule 36(4) relating to 20%/10% ITC cap on Eligible Input Tax Credit, GSTR 2A are few of major thorns on the path of swift and easy path of filing monthly returns.
With restrictions on ITC, huge funds of working capital are blocked every month leading to financial constraints in the economy. Further ITC due from Quarterly Return filers are blocked for a span of 4 months from the date of Invoice after insertion of Rule 36(4).
Annual Return being the biggest worry as the due date for filing has been constantly postponed due various reasons such as utility update, form revision, etc.
Inability to revise the return, complex amendment options, too exhaustive information asked from the registered person are some of major issues faced.
Rule 138 E of CGST/SGST Rules, 2017 was brought into effect on 1st December 2019 which caused blocking of EWB generation if tax payer does not file GSTR 3B for two consecutive periods. This is a bane to the compliant Tax Payer as he may be forced to suffer along with the non-compliant counter party.
Minor to Major difference between GSTR 3B and GSTR 1, GSTR 3B and GSTR 2A are causing issuance of notice to the Tax Payers. This is an additional burden to the genuine tax payers.
Again, the non- compliant counter party is causing trouble for the compliant ones. Instead of issuing notice and drafting provisions which can trap the non- compliant parties, the burden of the same is shifted to genuine tax payers from Tax Officers.
Composition Scheme, Quarterly returns and other benefits provided to small businesses are far less when compared to the problems faced by them. As a dedicated staff or hiring of professional is required for the compliance purpose which increases their cost and in turn reduces the profit. Also, the complexity of the law makes it difficult for a common man to understand and remain constantly updated with the provision. There are large areas in our countries with no proper infrastructure and facilities to support the businesses and in such places, GST is another hinderance to their growth and development.
Professionals like Chartered Accountants, Cost Accountants and other GST Practitioners are the link between the Tax Payers and Government. With constant updates, multiple and different due dates for each client, complexity of the laws and increase in compliance has significantly increased the burden on them. Generally, these problems are perceived as excuses as they are being paid for the same. Unfortunately, only the fraternity of Professionals can understand the work and efforts required for providing correct, true and fair assurance, consulting and other advisory services.