GST Council Meeting: For Taxpayers, Relief In Compliance On Many Fronts
The government intends to make the GST assesses' life easier and is working towards less compliance, said Finance Minister Nirmala Sitharaman.
The 53rd GST Council meeting ended with focus primarily on easing compliance burden on taxpayers and limiting litigation rush for the government, while keeping tricky reform subjects at a distance.
The highlight among the policy decisions is the Council's recommendation to waive interest and penalties for demand notices issued under Section 73 of the CGST Act — that do not involve fraud, suppression or willful misstatement — for fiscal years 2017-18 to 2019-20, if the full tax demanded is paid up to March 31, 2025.
Our intent is to make the GST assesses' life easier.Finance Minister Nirmala Sitharaman
"We are working towards less and less compliance. I want to underline the fact, on behalf of the CGST, that notices are not being sent here left, right and center. Only 1.96% of all active tax assesses have been sent any notice from the Central GST," the finance minister said.
"The GST Council focused on easing the life of taxpayers by reducing burden of penalties and interest and some rationalisation on hostel rent taxation. Policy issues were not taken but matters dealing with basic taxpayer concerns were taken," SC Garg, former finance secretary, told NDTV Profit.
Aadhar-Based Authentication To Crack Down On Fake Invoices
Scaling its Gujarat pilot project to the national level, the GST Council recommended to roll-out the biometric-based Aadhaar authentication of registration applicants on pan-India basis in a phased manner to combat fraudulent input tax credit claims made through fake invoices.
Andhra Pradesh Finance Minister Payyavula Keshav noted in the council meeting that physical verification weeds out fake registration successfully therefore the step to operationalise it pan-India has been taken, Sitharaman said.
Litigation
To reduce government litigation, the Council has recommended monetary limit of Rs 20 lakh for GST Appellate Tribunal, Rs 1 crore for High Court and Rs 2 crore for Supreme Court for filing of appeals by the department.
The Council has also recommended maximum amount of pre-deposit for filing an appeal with the appellate authority be reduced to Rs 20 crore from Rs 25 crore for both CGST and SGST.
Further, the amount of pre-deposit for filing appeal with the Appellate Tribunal has been reduced from 20% with a maximum amount of Rs 50 crore CGST and Rs 50 crore SGST to 10% with a maximum of Rs 20 crore CGST and Rs 20 crore SGST.
These decisions have been taken to ease cash flow and working capital blockage for the taxpayers, the government said.
The defined monetary limits to appeals on GST cases is a good start, said Rajat Bose, partner at law firm Shardul Amarchand Mangaldas.
"A lot of litigation will come once GSTAT is set up. This move is good where government can limit litigations in the coming years. But revenue secretary saying the limit does not apply in policy matters, this needs to be looked at," he said.
The GST Council recommended amending Section 112 of the CGST Act to provide that the three-month period for filing appeals in GST Appellate Tribunal will start from a date to be notified by the Government. This will give sufficient time to the taxpayers to file appeal in pending cases.
The Council recommended amendment in CGST Act provisions to provide a sunset clause of April 1, 2025, for anti-profiteering under GST. Moreover, a decision has been taken to shift hearing of such cases from the Competition Commission of India to GST Appellate Tribunal when it becomes functional.
