GST: Compliance rating system will come in place in few months

Goods and Services Tax (GST) continues to be the hot topic even after days of its launch. Any development or information seem to be vital around it. When Maharashtra’s GST department, Commissioner of State Tax, Rajiv Jalota talks about it, there is lot mo

How many tax assesses have registered (under GST) from Maharashtra?

■ That break-up might be available with our office. Now more than 2 lakh applications have come, it is divided 50:50 (between state and centre). Already 1.5 lakh registration have been granted and in the present system 73 per cent are proprietorship concerned. In the new lot that have come under the GST regime, around 88 per cent is proprietorship concerned. This shows people want to be compliant. More and more individual firms are taking registration. It is a good sign. In fact, large number of textile firms have registered. As far as registration issue is concerned, people are settling down.

The validation of pan card, mobile number and email id is done in the beginning. Only after the validation is done, the person can move ahead with the registration. This way we are trying to control people. With proprietorship concerns, we have made the whole process lot easier. Only companies and firms have to give details of their constitution or former constitution of the company and this is the addition requirement that is needed.

Compliance burden has reduced as far as registration is concerned. There are a lot of misconception about the filing of return which will not be that cumbersome. The sales record has to be maintained carefully as your sales will be someone else purchases. Any failure in validation of taxes or non-payment of taxes (on any sales) can be a burden on the purchaser. This is the only problem that the business is facing.

In the next six to eight months, business will evolve, and their self-correction will take place automatically. By then, our compliance rating system will come in place and those businesses that are not complying will be getting low rating. This will allow businesses to know which company or firm they should do business with. Over a period of time compliance will increase.

From which locations are the most help sorted?

■ In smaller locations, more help is sort from our teams. Otherwise, assessees are filing online registrations. If our officers do not approve the registration applications in three days, then it gets auto-approved. Here the system is designed in such a way that the anomalies that used to be in the present system is removed.

When can a show cause notice be issued?

■ A showcase notice can only be issued on a registration application once and that is possible only after a complete detail is mentioned. Within seven days of the issue, the dealer has to reply to it. After the dealer replies, within seven days the officer has to act upon it or else the whole process gets automatically approved. The system has been designed in that fashion. Through this regime, the intimacy with the bureaucracy is minimised or removed.

Will the businesses be scrutinised under GST regime?

■ We do not scrutinise anybody immediately, it is never done. The scrutiny of returns happens. Once scrutiny of returns happen, people come to us directly. For instance, someone would say that he or she has inadvertently applied for compensation and please take me out. We had not considered about this contingency in the Act because if you apply that means you have applied and we had not considered other options. But in the new system, people have realised that the turnover is going to be higher. So they comply. These kind of people will be assisted by other people (to be less tax compliant) that is when scrutiny of the return will take place. If you have charged extra in taxes than one can issue a debt and credit note and sort the issue. If someone is collecting taxes from someone and not paying than that person will be scrutinised.

Certain offences are made serious offence. One such offence is the one where you collect taxes and do not pay taxes in three months. It is among the serious offence. You sell goods and do not issue the invoices. Or you issue invoice but do not sell the goods and those are serious offences. These are various serious offence.

Can the registration of assesses be cancelled without allowing them to communicate?

■ There are contingencies written down in the act which states when registration can will be cancelled. Registration will get cancelled unilaterally. For that we have to give the showcause notice and law of natural justice has to be applied. There are growing number of rumours around GST regime.

GST Suvidha Provider is recognised by Government but Application Service Providers (ASP) is not. There is a fear about unethical ASP misusing data of tax assessees. Your view.

■ Today also you are giving it to your practitioner. I think that is not a logical concern as you will select your ASP whom you are comfortable with. The company staff can also do GST related work. We are actually asking associations like pharmacist associations in Pune to help small pharmacies. There are many pharmacies in Pune that do not have access to computer. There is a need to do a demystification in that level.

Has number of queries risen after uploading on the GSTN started?

■ For queries we have made few groups which consist of few practitioners that we feel are committed professionals. They are those people who can tell us that there is some glitches in the system for upload. There is an IT committee that is formed and Maharashtra is part of that. Every week there is a video conference that takes place between GSTN and Maharashtra government. Then the IT committee resolves these issues. There are certain issues that require quick resolution. There is a hotline between GSTN and the concerned state which helps to resolution issues quickly.

What kind of technologies is GSTN looking at exploring?

■ We are thinking about having a system wherein you can feed in your invoices in a go and how the other party can see that instantly. It is a technological challenge which is a difficult one.