GST rates re­laxed for petroleum sec­tor

Dead­line ends, after 2 ex­ten­sions; govt to as­sess rea­sons for low rate of com­pli­ance

Business Standard - - FRONT PAGE - DILASHA SETH

Two days after Prime Min­is­ter Naren­dra Modi held a meet­ing with heads in the petroleum in­dus­try, the govern­ment said it would soon is­sue no­ti­fi­ca­tions low­er­ing the goods and ser­vices tax (GST) rates. Ac­cord­ing to the re­vised rates, trans­porta­tion of nat­u­ral gas through a pipe­line would at­tract 5 per cent GST with­out in­put tax credit and 12 per cent with it.

About 70 per cent of the as­sessees un­der the goods and ser­vices tax (GST) had filed de­tailed sales re­turns for July as on Tues­day, the of­fi­cial dead­line. Low com­pli­ance, said of­fi­cials.

No fur­ther ex­ten­sion was given; the dead­line had been ex­tended twice ear­lier. About 4.59 mil­lion en­ti­ties of the el­i­gi­ble 6.5 mn filed the GSTR-1 re­turn, for the first month of GST.

“We will as­sess why many peo­ple have not filed. We have al­ready sent re­minders to those who filed GSTR-3B, the sum­marised re­turn form, but not GSTR-1,” said a GST Net­work GSTN) of­fi­cial.

The dead­line to file GSTR1 was ex­tended by a month from Septem­ber 10 at the GST Coun­cil meet­ing last month in Hy­der­abad. Ear­lier, the dead­line was ex­tended from Septem­ber 5 on ac­count of tech­ni­cal is­sues with GSTN.

If a tax­payer fails to file GSTR-1 by the dead­line, the buyer of his prod­ucts would face dif­fi­culty in avail­ing of in­put tax credit. Which is why, noted Pratik Jain, part­ner at con­sul­tancy PwC, the num­ber of GSTR-1 re­turns are much lower than what one would have ex­pected.

It is pos­si­ble many deal­ers with GST reg­is­tra­tion have nil turnover and, hence, did not file the re­turn. “The govern­ment will have to in­ves­ti­gate the rea­sons and take cor­rec­tive steps,” he added.

Three mil­lion re­turns had been filed as of Septem­ber 10, the day after an­nounce­ment of the ex­ten­sion. About 1.5 mn more re­turns were filed after that.

GSTR-1 has 13 sec­tions con­tain­ing de­tails of sales trans­ac­tions of a reg­is­tered dealer for a month. A lit­tle more than 330 mn in­voices were filed and pro­cessed by the GST sys­tem along with the GSTR-1 of July. Of this, 73 per cent were up­loaded us­ing the Of­fline Tool de­vel­oped by GSTN; 16 per cent of the in­voices came through GST Su­vidha Providers.

The in­ward sup­plies re­turn or GSTR-2 for July has to be filed by Oc­to­ber 31. And, GSTR-3 for the month by Novem­ber 10. Once a tax­payer files GSTR-1, the govern­ment utilises the in­for­ma­tion to ver­ify GSTR-3 for the dealer and GSTR-2A for deal­ers to whom sup­plies have been made.

For the tran­si­tion pe­riod, the govern­ment has al­lowed as­sessees to file self-sum­mary re­turns for in­put- out­put, called GSTR-3B.

The lower-than-ex­pected GSTR-3B re­turns filed in the first two months of GST im­ple­men­ta­tion had prompted rev­enue sec­re­tary Has­mukh Ad­hia to ask cen­tral and state com­mis­sion­ers to ur­gently con­duct a sur­vey to know why. Only about 64 per cent of those el­i­gi­ble filed GSTR-3B, for Au­gust; 84.2 per cent did so for July. Of the 7.3 mn el­i­gi­ble ones, 4.7 mn filed the sum­marised re­turn for Au­gust.

The ques­tions sug­gested in the sur­vey on why GSTR-3B was not filed are: The site was not func­tion­ing, fil­ing process was too com­pli­cated, sys­tem didn’t al­low me to file nil re­turn and ‘could not’ pre­view re­turn de­tails be­fore fil­ing re­turns. In ad­di­tion, tax of­fi­cers will take sug­ges­tions for im­prov­ing the re­turns fil­ing process.

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