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News Indirect Tax-GST

  • Mar 26, 2019
  • IGST-credit-first rule: Taxpayers unsure of GSTN fiat’s legal status

    The contradictory responses from the Goods and Services Tax Network (GSTN) to assessees’ queries on the unavailability of a new functionality for offsetting tax liability has raised concerns among businesses, which fear that they may be hauled up later by the tax department for non-compliance as GSTN’s advice may not have any legal standing. The GST Act saw several amendments last year, which included changes in discharge of tax liability from the existing input tax credit (ITC) in the electronic ledger of an assessee. The Act mandated that from February 1, a taxpayer must first extinguish the integrated GST (IGST) credit to pay for liability of IGST, Central GST and state GST.

  • Mar 25, 2019
  • Fake invoices to evade GST pose a big challenge, tax officials looking at different strategies to curb menace

    Faced with the big challenge of tackling fake invoicing in GST regime, tax officials are looking at different strategies to curb this menace and shore up revenue collections. Central Board of Indirect Taxes and Customs (CBIC) Member (Investigation) had recently said that between April and February 2018-19, GST evasion to the tune of Rs.20,000 crore was detected, of which Rs.10,000 crore was recovered. Officials estimate that evasion through fake and under-invoicing could be pegged at anywhere between one per cent and five per cent of collection.

  • Mar 23, 2019
  • Govt extends IGST, compensation cess exemption under various export promotion plans

    Giving relief to exporters, the government has extended IGST (Integrated Goods and Service Tax) and compensation cess exemptions for goods procurement under certain export promotion schemes till March 2020. These exemptions have been extended for exporters buying inputs domestically or importing for export purposes under export oriented unit (EOU) scheme, Export Promotion Capital Goods (EPCG) scheme and advance authorisation.

  • Mar 23, 2019
  • GST Council's plan for real estate sector may not find many takers

    The Goods and Services Tax (GST) Council’s decision to give developers the power to choose between the old and new tax rates might not find many takers, industry experts have said. According to many developers, the demands they had from the GST Council have not been approved.Many claim that by giving this option, the government has side-stepped from its responsibility and the move would make the whole tax process cumbersome and chaotic. “The realty sector is already loaded with multiple legislations restrictions.

  • Mar 22, 2019
  • Government extends IGST, compensation cess exemption under various export promotion plans

    Giving relief to exporters, the government has extended IGST (Integrated Goods and Service Tax) and compensation cess exemptions for goods procurement under certain export promotion schemes till March 2020. These exemptions have been extended for exporters buying inputs domestically or importing for export purposes under export oriented unit (EOU) scheme, Export Promotion Capital Goods (EPCG) scheme and advance authorisation. EPCG is an export promotion scheme under which an export.

  • Mar 20, 2019
  • Realty firms can opt for old or new rates for ongoing residential projects

    Real estate developers have the option to adopt a lower rate of Goods and Services Tax (GST) without input tax credit (ITC), or go for the existing rate with ITC. This applies to ongoing projects (buildings where construction and actual booking have both started before April 1, 2019, but which will not be completed by March 31, 2019). Projects beginning on or after April 1 will fall into the lower GST rate regime automatically. A decision to this effect was taken by the GST Council at its 34th meeting on Tuesday.

  • Mar 20, 2019
  • GST Council Meet: Input tax credit rules for under-construction projects approved

    The Goods and Services Tax (GST) Council has given a go-ahead to new tax provisions for housing units, Revenue Secretary A B Pandey said. Reasonable time for transition will be given to developers in consultation with states, Pandey told reporters after the Council meet in New Delhi. The meeting deliberated on the transition provision and related issues for the implementation of lower GST rates for the real estate sector.

  • Mar 19, 2019
  • GST Council Meet: Input tax credit rules for under-construction projects approved

    The Goods and Services Tax (GST) Council has given a go-ahead to new tax provisions for housing units, Revenue Secretary A B Pandey said.Reasonable time for transition will be given to developers in consultation with states, Pandey told reporters after the Council meet in New Delhi.The meeting deliberated on the transition provision and related issues for the implementation of lower GST rates for the real estate sector.

  • Mar 18, 2019
  • Restaurant-cum-sweetshops to have two set of GST rates, says AAAR

    Restaurant-cum-sweet shops are better off maintaining two books of accounts for the Goods and Service Tax (GST) regime. Besides, billing and taxation on the same items sold through restaurants and sweet shops located in same premise will be different. In one of the rare cases, the Appellate Authority for Advance Rulings for the State of Uttarakhand Goods and Services Tax (AAAR-UK) has set aside the ruling of AAR which allowed a restaurant-cum-sweetshop to levy one rate of 5 per cent on all the goods —sweetmeats, namkeens, cold drinks, ready-to-eat (partially or fully pre-cooked/ packed) items supplied from live counters such as jalebi, chola bhatura and other edible items, sold through sweetshops or served in the restaurants.

  • Mar 18, 2019
  • GST Council to consider implementation of lower GST rates for realty sector

    The all powerful GST Council in its 34th meeting to be held on Tuesday is expected to take up various issues including the implementation of lower GST rates for the real estate sector. The meeting is likely to deliberate only the transition provision and related issues for the implementation of lower GST rates for the real estate sector, sources said, adding, no issues related to rate is in the agenda as the model code of conduct is in force. In the previous meeting (February 24), the high-powered GST Council slashed tax rates for under-construction flats to 5 per cent and affordable homes to 1 per cent, effective April 1.

  • Mar 16, 2019
  • Companies allowed to pass on volume benefit to consumers for GST cut

    The National Anti-Profiteering Authority (NAA) Friday said companies are free to offer volume benefit or price reduction to consumers, in the wake of rationalisation of GST rates. To evaluate cases of GST benefits, the NAA has decided to look into three yardsticks - proportionate grammage increase (volume) in products, timeline of the passing on the benefit, and additional benefits offered by a firm.

  • Mar 13, 2019
  • Gold coins for free distribution may not qualify for input tax credit

    Giving free gold coins could prove expensive for businesses as it is unlikely to be classified for input tax credit (ITC). In sync with the Authority for Advance Rulings in Maharashtra (AAR Maha), the Finance Ministry has said ITC shall not be available to the supplier on the inputs, input services and capital goods to the extent they are used in relation to the gifts or free samples distributed without any consideration.

  • Mar 13, 2019
  • Assessees can view, download month-wise report on liability declared, credit claimed on GST portal

    Goods and Services Tax Network (GSTN), the IT backbone of GST, on Tuesday announced unveiling of a facility that will allow taxpayers to view and download month-wise report on tax liability, declared and paid. There will also be information regarding input tax credit (ITC). This functionality has been provided in Returns dashboard on the GST portal to taxpayers under the headings ‘Comparison of liability declared and ITC claimed’. The data can also be downloaded in Excel file for viewing and comparison later on.

  • Mar 11, 2019
  • GST: With no tax collection at source, relief for luxury cars, jewellery buyers

    In a relief to buyers of high value cars and jewellery, the Central Board of Indirect Taxes and Customs (CBIC) has said that the tax collection at source (TCS) amount would be excluded from the value of goods for computing GST liability. Under the Income Tax Act, the TCS is levied at one per cent on purchase of motor vehicles above Rs 10 lakh, jewellery exceeding Rs 5 lakh and bullion over Rs 2 lakh. TCS is also levied on other purchases at different rates. The CBIC in a circular said that the TCS amount would be excluded from the value of goods while computing the Goods and Services Tax (GST) liability.

  • Mar 11, 2019
  • Companies with high input tax claims under lens

    Indian businesses that paid most of their goods and services tax (GST) liability using input tax credit or reported asignificant variation in turnover are being queried by taxmen, a move that has irked industry and prompted it to petition the authorities against such tactics. Tax officials have sent emails seeking information from businesses that paid over 95% of their dues using input tax credit to ascertain the key factors responsible for subdued GST collections.

  • Mar 11, 2019
  • GST: Maharashtra authority calls maintenance contracts a service

    Giving clarity on goods and services tax (GST) to those providing annual maintenance contracts (AMCs) for several items, including white goods and electronic products, the Maharashtra Authority for Advance Ruling (AAR) has said that AMCs are a “composite supply” and classified them as service. The issue, raised by Cummins India — which provided AMCs for diesel and natural gas engines sold by it — was the tax classification of the maintenance contract as it entailed provision of service and supply of parts, which are goods. The ruling will help get clarity on the tax rate for goods that may be supplied under the contract.

  • Mar 09, 2019
  • No GST on TCS levied on goods, clarifies tax authority

    The Central Board of Indirect Taxes and Customs (CBIC) has clarified that for the purpose of calculation of GST on a particular good, the tax collected at source (TCS) would not be included in the price of the good as the same is an interim levy. A clarification in this regard was issued by the CBIC after representation from the industry and consultation from the Central Board of Direct Taxes (CBDT). According to the clarification, 'TCS is not a tax on goods but an interim levy on the possible income arising from the sale of goods by the buyer and to be adjusted against the final income-tax liability of the buyer'.

  • Mar 08, 2019
  • GST exemption limit of Rs 40 lakh for SMEs to be effective from April 1

    The government Thursday notified April 1 as the date for the implementation of doubling of GST exemption limit to Rs 40 lakh, which will benefit small and medium enterprises. Besides, the effective date for availing higher turnover cap of Rs 1.5 crore for availing composition scheme by traders has also been fixed as April 1. Also, service providers and suppliers of both goods and services with a turnover of up to Rs 50 lakh would be eligible to opt for the GST composition scheme and pay a tax of 6 per cent from the beginning of next fiscal.

  • Mar 08, 2019
  • Maharashtra offers one-time GST amnesty

    State governments have begun rolling out one-time amnesty schemes to wipe out all legacy tax issues from before the rollout of the goods and services tax regime. Maharashtra has unveiled an amnesty scheme for settlement of pre-GST state tax disputes to ensure that the government recovers outstanding taxes and also clears the backlog of long pending assessments. Karnataka and West Bengal had announced such schemes earlier. The Maharashtra government has issued an ordinance to bring into effect a scheme that provides for settlement of dues under various state levies, including VAT, CST, entry tax, professional tax, luxury tax, and purchase tax on sugarcane.

  • Mar 08, 2019
  • Auto dealers concerned over updated CGST Act

    A month after the introduction of the Section 49A in the CGST Act, a body of auto dealers have communicated to the PMO, the financeNSE -4.36 % ministry and the GST Council about the impact the revised law will have on their cash flow, especially at a time when the momentum of sales is waning. They said that the amendment will force them to pay GST in cash even when they have unutilised tax credit.

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