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