Officers panel to finalise changes in GST laws and rules today ahead of council meet on Jan 18

The law review committee’s proposals aims to simplify procedures and make the new tax system simple

Deferment of some of the key features under GST, including reverse charge mechanism (RCM), tax deducted at source (TDS) and tax collected at source (TCS) among others are some of the key recommendations submitted by a panel of officers.

The law review committee, comprising senior officers from the Centre and states, finalised their recommendations on January 5. These proposals would be reviewed by a group of officers from the finance ministry tomorrow, before they present it to the Goods and Services Tax (Council) on January 18.

“RCM may be deferred beyond April 1, 2018. Only businesses under the composition scheme (a scheme for small taxpayers) would come under RCM,” an official said.

Reverse charge is a mechanism where the recipient of the good or service will have to pay GST, which is otherwise paid by the supplier. The charge is applicable on a registered dealer, if he buys goods from a dealer not registered under GST. However, the receiver of the good is eligible for input tax credit, while the unregistered dealer is not.

While registered taxpayers were not willing to take the burden of paying tax, small or unregistered taxpayers would have run out of business if registered dealers did not buy goods from them. Keeping this in mind, GST Council headed by Finance Minister Arun Jaitley in October deferred the mechanism till April 1.

In addition, a decision would be taken on simplifying the return filing process, the official said.

“The concept of invoice matching will continue to exist as it is one of the core principles of GST. However, the return filing forms will be simplified and put up in a way that would ease compliance burden,” the official said.

Since its implementation from July 1, the new indirect tax system has faced criticism owing to the teething troubles including high rates, delay in refunds, lack of clarity on return filing, errors in invoice matching, and major technical snags on the information technology portal GST Network (GSTN), among others.

The law review committee’s proposals aims to simplify procedures and make the new tax system simple.

Source: moneycontrol

Comments
Loading...