GST returns filing: Deadline ends, figures suggest robust collections

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As the extended deadline for filing the first tax returns under the goods and services tax (GST) ended on Friday evening, taxpayers inundated the GST Network (GSTN), the technology back end.
Given that the states’ combined GST tax revenue is estimated to be roughly equal to that of the Centre, a monthly GST revenue of Rs 1.55 lakh crore would meet the projections.

As the extended deadline for filing the first tax returns under the goods and services tax (GST) ended on Friday evening, taxpayers inundated the GST Network (GSTN), the technology back end. However, no official word was available on how many of the 87 lakh businesses registered on the portal filed the returns or paid taxes before the deadline.

Although it is too early to make any estimate, the tax collections under GST seem to endorse the forecast that the new tax will boost government revenues.

When just about 20 lakh of the 87 lakh taxpayers registered on the GSTN portal filed their returns and paid taxes as on Wednesday, some Rs 50,000 crore went to the total GST kitty. The Centre’s indirect tax target for the current financial year is Rs 9.26 lakh crore, which means a monthly average collection of Rs 77,200 crore.

Given that the states’ combined GST tax revenue is estimated to be roughly equal to that of the Centre, a monthly GST revenue of Rs 1.55 lakh crore would meet the projections. This doesn’t appear to be a tall order given the collection trend.

Of course, the GST collections being cited now are gross figures, without deducting the input tax credits that businesses are expected to claim and are estimated to be substantial, given the inherent nature of the new taxation system.

Till Thursday, 25 lakh taxpayers had filed their returns while an equal number had saved relevant details on the portal. GSTN officials told FE that the final numbers on the returns filed and taxes collected would be revealed by the revenue department.

The GSTN has, however, been grappling with a large number of taxpayers who are yet to complete their registration. This would prevent them from filing their return for July. The GSTN had prepared for a potential 39 lakh taxpayers to use the portal for filing tax return on Friday. This, GSTN officials said, was expected as even in the VAT regime half of the taxpayers filed returns on the last two days of the deadline.

Of the total GST amount of Rs 50,000 crore collected till Wednesday, Rs 20,000 crore had come in as integrated GST, which is levied on interstate movement of goods and imports. An amount of just over Rs 5,000 crore had been paid by assessees by way of cess on demerit goods such as cars and tobacco. The remaining Rs 25,000 crore had come in as central GST and state GST, which would be split equally between the Centre and the states.

Last Saturday, the government decided to extend the deadline for filing the interim summarised tax returns to August 25 from August 20 earlier, citing requests from taxpayers and difficulty experienced by states hit by floods.

This came after taxpayers and GST Suvidha providers — IT companies authorised to file returns on behalf of customers — complained that the GSTN system wasn’t accepting the filings.

Separately, nearly 10 lakh have registered on the portal for the composition scheme, which allows simpler compliance for businesses with an annual revenue of up to Rs 75 lakh. Of 87 lakh registered on the GSTN portal, nearly 71 lakh businesses have migrated from the earlier VAT, central excise or service tax regime, while 16 lakh are new taxpayers.

Source:  Financial Express

Big relief for taxpayers, GST deadline to file returns extended by CBEC to August 28

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In what could bring relief to small taxpayers with cash flow issues, CBEC has extended the deadline for taxpayers claiming input tax credit on transition (pre-GST) stocks to file the first interim returns for July by a week to August 28.

In what could bring relief to small taxpayers with cash flow issues, the Central Board of Excise & Customs (CBEC) has extended the deadline for taxpayers claiming input tax credit on transition (pre-GST) stocks to file the first interim returns for July by a week to August 28. However, these taxpayers will have to settle their tax liability by the earlier deadline of August 20.

The deadline for filing returns will continue to be August 20 for assessees who do not opt to claim ITC in July for goods bought before the GST roll-out. “The taxpayers who want to avail the transitional input tax credit should also calculate their tax liability after estimating the amount of transitional credit as per Form TRANS I. They have to make full settlement of the liability after adjusting the transitional input tax credit before 20th August, 2017,” the CBEC said.

The board, however, added that in such cases, the taxpayers will get time till August 28 to submit Form TRANS I and Form 3B on the GST Network, the IT back end. “In case of shortfall in the amount already paid vis-à-vis the amount payable on submission of Form 3B, the same will have to be paid with interest at18% for the period between 21st August, 2017 till the payment of such differential amount,” the CBEC added.

Also, the GST Network is expected to release TRAN-1 and TRAN-2 forms — to be used for claiming ITC on transition stock – on August 21. These new forms will have provision for claiming ITC for pre-GST stocks, addressing the industry’s concerns over absence of the same in the earlier Form 3B.

“While past input tax credit might not bother multinationals and large companies, smaller companies can’t afford to let their working capital inflate,” R.N Iyer, managing director of the GST suvudha provider Vayana Network said.

Although the initial trends suggested a slow rate of tax filings, GSTN officials said that most a substantial chunk of taxpayers tend to file their return on the last two days of the deadline. “GSTN system is capable of handling even half the total load of filers on the last two days as the redundancy was built based on a study that showed the same return-filing trend even in VAT regime,” the official had said.

Till August 5, nearly 87 lakh taxpayers had registered on the GSTN portal as taxpayers under GST. Of this, nearly 71 lakh businesses have migrated from earlier VAT or central excise or service tax regime, while 16 lakh new taxpayers too have registered with the portal. The GSTN had earlier said over 30% of the firms registered on the portal had not completed the second form. This would prevent these businesses from filing returns.

 

Source: http://www.financialexpress.com/economy/big-relief-for-taxpayers-gst-deadline-to-file-returns-extended-by-cbec-to-august-28/813156/

Here’s how a missing column in GST return form is creating trouble for India Inc

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Many cos don’t know whether the govt will rectify this problem by Friday and are following different options for resolving the quandary.

A top conglomerate may have to shell out a bit extra in advance tax this quarter due to an unusual glitch in the tax returns form. Another Delhi-based firm, which does not want to bear any extra tax, may simply deduct the dues before the GST kicked in on July 1 and pay a smaller net amount.

The absence of a column in the new GST form for claiming credit on sales made before July 1 this year is causing a lot of worries for India Inc as the filing deadline for the first month of tax returns under GST comes up this week.

Many companies don’t know whether the government will rectify this problem by Friday, the deadline for filing returns, and are following different options for resolving the quandary. Multinationals and some of India’s biggest companies are not taking into account past input credit while paying GST while smaller companies that can’t afford to let their working capital rise are paying the tax after deducting the input tax credit.

GST“A procedural lapse by the government doesn’t take away companies’ right to what’s prescribed in the law. GST law prescribes that companies can adjust past credits with July and August liabilities,” said the CFO of a Delhi-based company.

 

Industry trackers, however, say that doing so may be “technically incorrect.” “Certain businesses may prefer being cautious and pay the tax for July and August without considering the opening credit balance, while other businesses would adjust the credit and pay the tax, leading to disparities in tax treatment from the first GST return,” said MS Mani, partner, Deloitte Haskins & Sells.

The deadline for filing the GST Transition Credit Form, titled GSTTran 1, is September 28, while that of making payments for July and August is much earlier. There is no column in GSTR 3B form where companies can mention the advance taxes paid before July 1. The government had said last week that it would sort out the issue, but with just four days left for filing the GSTR 3B form companies are not waiting for clarification.

“Companies are puzzled by what they should be doing and why they could be required to fork out large sums as GST in July and August and the apparent inability of the government to simply permit the utilisation of the opening credit while computing the tax liability for July and August,” said a tax expert advising four of the biggest Indian companies.

Back of envelope calculations by two tax consultants show Indian companies may end up paying anywhere around Rs 13,000 crore more to government for July and August. If this happens, working capital costs are likely to rise across the board.

“There would be a significant impact on the working capital of several companies if they are not permitted to use the opening balance of credits. It does appear that the legislative intent of permitting carrying forward of credit from the earlier regime without any timing intervals has not been appropriately reflected in the GST returns for July and August,” said Mani.The government may just see a windfall gain for July and August GST in advance tax collection thanks to this procedural lapse.

ET View: Clear the Air
 The GST Council should clear the air to avoid disputes. The purpose of GST is to provide set offs across the production and value chain to avoid tax on tax and cascading tax rates for goods and services. Rightly, the compliance regime was easy to start with. A true picture on how well GST is working would be known when companies start getting refunds on the taxes paid by them. So, procedural lapses, if any, must be corrected to remove any confusion for companies.

10 days to go; GSTN set for last minute rush on slow pace of returns filing

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With barely 10 days left for goods and services tax (GST) assessees to file summarised interim returns, the GST Network (GSTN), the IT back end for the indirect tax regime, hasn’t yet started witnessing high-frequency traffic, indicating a possible last-minute rush. Till August 5, nearly 87 lakh taxpayers had registered on the GSTN portal as taxpayers under GST.

With barely 10 days left for goods and services tax (GST) assessees to file summarised interim returns, the GST Network (GSTN), the IT back end for the indirect tax regime, hasn’t yet started witnessing high-frequency traffic, indicating a possible last-minute rush. “We have just 16,000 returns till August 8 while there are 87 lakh businesses registered with us,” GSTN chairman Navin Kumar told FE on Wednesday. However, he added that the back end was equipped to handle even a last-minute rush. “Half of the people might come on the last day,” he said, attributing the low traffic on the portal so far to assessees’ behaviour pattern.

Only a little over half of the registrants on GSTN have so far completed the process by filling up part B of the registration form.

The interim return, GSTR 3B, requires taxpayers to provide a summary of outward sales, purchases, input tax credit demand and tax liability. The window for filing these returns commenced on August 5 and it will remain open till August 20. The GST Council had earlier postponed the requirement for filing full-fledged returns to September, and allowed the taxpayers to file interim return for July and August, in a bid to reduce their initial hassles.

Kumar, however, told FE that not all of the 16,000 taxpayers had completed the return filing process as many are yet to pay the tax. “The taxpayers have come to the site and saved the relevant data on the portal but not submitted it as they need to first pay the tax before submission, which hasn’t happened,” Kumar said .

He admitted that the the traffic on the portal had been slow thus far, and urged the assessees to not wait for the last day to file returns. However, he assured that the GSTN system was robust enough to handle the heavy traffic it might experience closer to the last date.

“We have designed the system keeping the possible deluge of taxpayers in the final hours as our study suggests that a very large number of taxpayers sign up on the last two days of the deadline,” Kumar said.

Additionally, businesses have the option of filing return with the help of GST suvidha providers (GSPs). GSTN has authorised 34 such firms to upload data onto the portal on behalf of taxpayers. However, only 18 such GSPs have been able to connect to the GSTN servers for filing the interim returns.

“I have been urging them to speed up their work,” Kumar said about GSPs that are yet to go live.

Till August 5, nearly 87 lakh taxpayers had registered on the GSTN portal as taxpayers under GST. Of this, nearly 71 lakh businesses have migrated from earlier VAT or central excise or service tax regime while 16 lakh new taxpayers too have registered with the portal. What could further compound the problem is the incomplete registrations submitted by the registrants. GSTN had earlier said that over 30% of the firm registered on the portal had not completed the second form. This would prevent these businesses from filing returns.

Source: Financial Express

Millions of firms not ready to file returns under GST: Kumar

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Millions of companies are still not ready to file their first returns under the new GST ahead of an 20 August deadline, says Navin Kumar. Photo: Bloomberg

Millions of companies in India are still not ready to file their first returns under the new goods and services tax (GST) ahead of an 20 August deadline, a top official told Reuters, urging them not to leave things to the eleventh hour.

Navin Kumar, chairman of the GST Network, also said barely half of the 34 service providers accredited to help firms bulk-file invoices online had received approval to go live.

Yet he gave an assurance that the huge IT back end that is designed to crunch up to 3 billion invoices a month and calculate companies’ taxes would be stable, even if there is a last-minute rush to file.

“It will not crash,” he told Reuters in an interview. “We are working on the assumption that 50% of the people will come on the last day.”

Billed as India’s biggest-ever tax reform, the GST has replaced a slew of federal and state levies. It has also cleared barriers between India’s 29 states, uniting its 1.3 billion people into a common market for the first time.

Yet the complexity of the tax — which has main rates of 5, 12, 18 and 28% and multiple exceptions — has raised concerns that companies will struggle to comply and file their monthly returns on time.

Even before the GST filings kick in, business surveys showed both the services and manufacturing sectors contracting at their fastest rate in years, heralding a likely dip in indirect tax revenues.

The government has allowed firms to file simplified, self-assessed GST returns by 20 August for the month of July, when the tax was launched.

They will have to file complete returns in early September that itemise and reconcile every single sales invoice under a regime that, by comparison with other countries, is labour- and data-intensive.

More than 7 million existing taxpayers have activated accounts on the GST’s portal — although around a third have yet to complete the form-filling required to file a full tax return, Kumar said.

Another 1.3 million new firms have registered to pay GST.

He waved away concerns that companies would not be able to cope, saying that those used to paying value-added tax —now abolished — were used to online filing.

Although companies can upload invoices directly into the GST portal, big businesses will rely on a new breed of service provider whose applications can format, reconcile and upload invoices in bulk.

Of a first batch of 34 services providers that have been accredited, only 18 have received permission to go live. “I have been urging them to speed up their work,” Kumar said.

Source: http://www.livemint.com

Income Tax Return Filings Grew 25%, Says Government

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Income tax collection showed a surge. The number of returns filed as on August 5, 2017, grew to 2.82 crore as compared to 2.26 crore last year, the government said.

The number of Income Tax Returns (ITRs) filed for 2016-17 year grew by 25 per cent to 2.82 crore, as increased number of individuals filed their tax returns post demonetisation, the tax department said today. The growth in ITRs filed by individuals is 25.3 per cent with over 2.79 crore returns having been received up to August 5 as against over 2.22 crore returns filed in the corresponding period last fiscal.

“As a result of demonetisation and Operation Clean Money, there is a substantial increase in the number of Income Tax Returns (ITRs) filed,” an official statement said. The total number of returns filed as on August 5 stands at over 2.82 crore as against over 2.26 crore filed during the corresponding period of 2016-17. This was an increase of 24.7 per cent compared to growth rate of 9.9 per cent in the previous year.

The last date for filing of income tax returns by individuals and HUFs, who need not get their accounts audited, was August 5.

The finance ministry said that the number of ITRs filed showed that substantial number of new tax payers have been brought into the tax net subsequent to demonetisation. The effect of demonetisation is also clearly visible in the growth in direct tax collections, it said.

Advance tax collections of personal income tax (other than Corporate Tax) as on August 5 showed a growth of about 41.79 per cent over the corresponding period in 2016-17. Personal Income Tax under Self Assessment Tax (SAT) grew at 34.25 per cent over the corresponding period in 2016-17.

“The above figures amply demonstrate the positive results of the government’s commitment to fight the menace of black money,” it added.

The Central Board of Direct Taxes (CBDT), which is the apex policy making body of the I-T department, is committed in its resolve to eradicate tax evasion in a non-intrusive manner and widening of tax base.

To fight the menace of black money, the government had on November 8, 2016, demonetised old 500 and 1000 rupee notes and asked holders of such notes to deposit in bank accounts. The I-T department had then launched operation clean money to clamp down on unaccounted money funnelled into bank accounts post demonetisation.

 

Source: http://www.ndtv.com/business/notes-ban-impact-income-tax-return-filings-grew-25-collections-jump-1734604