RECENT DEVELOPMENTS IN GST

[Dr. Sanjiv Agarwal]

Indian economy has already started showing signs of recovery and improvement. This is facilitated by targeted fiscal relief, monetary policy and a satisfactory vaccination drive. The broad economic relief packaged announced amid 2^nd Covid wave of ₹ 6.29 lakh crore, coupled with RBI’s efforts to calm market and revive the affected sectors (e.g. tourism, health etc) has a multiplier effect on growth efforts.

Rating Agency, Fitch has lowered India’s GDP growth forecast to 10% for the financial year 2022 on account of Covid induced lockdown, slow recovery and banking sector prospects. Disruption in several major businesses has slowed the economic recovery and adversely impacted the road to recovery as expected. Earlier, S&P and Moody’s had also lowered the growth projection to 9.5% and 9.3% respectively. RBI has already indicated it @ 9.5% for financial year 2021-22. RBI feels that post Covid second wave, economic activities are expected to improve further and main challenge is economic revival and growth.

The gross GST revenue collected in the month of June’ 2021  is  ₹ 92,849 crore of which CGST is  ₹ 16,424 crore, SGST is ₹ 20,397, IGST is ₹ 49,079 crore (including ₹ 25,762 crore collected on import of goods) and Cess is ₹ 6,949 crore (including ₹ 809 crore collected on import of goods). The above figure includes GST collection from domestic transactions between 5thJune to 5th July’2021 since taxpayers were given various relief measures in the form of waiver/reduction in interest on delayed return filing for 15 days for the return filing month June’21 for the taxpayers with the aggregate turnover upto₹ 5 crore in the wake of covid pandemic second wave. The revenues for the month of June 2021 are 2% higher than the GST revenues in the same month last year.

Indirect tax collections of Union for April, May and June, 2021 (a little less then Rs. one lakh crore in June) and more capital expenditure in infrastructure (like, roads, railways) helped continued  economic recovery. According to MoF, maintaining a rapid pace on vaccination and quickly bridging health care infrastructure gaps across both, urban and rural areas would emerge as the most sustainable stimulus for durable recovery of the Indian economy.

There exists two vacancies of technical members in National Anti-profiteering Authority (NAA), as notified by CBIC. As per Rule 122(b) of CGST Rules, 2017, officers who have been Commissioner under the State or Central Tax or equivalent post in existing law for a period of atleast one year are eligible for the post of technical member.

Various new functionalities have been notified on GSTN portal for the benefit of ease and facilitation of the taxpayers.

Recent changes  in QRMP Scheme implemented on the GST Portal for the taxpayers

Following important changes related to QRMP Scheme implemented on the GST Portal for the taxpayers have been made :

• Auto population of GSTR-3B liability from IFF and Form GSTR 1 : A taxpayer under QRMP Scheme can declare their liability through optional IFF for Month 1 and Month 2 of a quarter & Form GSTR-1 for Month 3 of that quarter. Declaration of liability in these forms would now be auto-populated in their Form GSTR-3B (Quarterly) for that quarter, based on their filed Form GSTR-1 and IFF.
• Nil filing of Form GSTR-1 (Quarterly) through SMS : Nil filing of Form GSTR-1 (Qtrly) through SMS has been enabled for taxpayers under QRMP Scheme. They can now file it by sending a message in specified format to 14409.

However, NIL filing through SMS can’t be done in following scenarios:

• If IFF for Month 1 or 2 of a quarter is in Submitted stage, but not Filed.
• If invoices are Saved in IFF for Month 1 or 2 of a quarter, which was not submitted or filed by due date.

• Impact of cancellation of registration on liability to file Form GSTR-1 : In case registration of a taxpayer under QRMP Scheme is cancelled, with effective date of cancellation being any date after 1st day of Month 1 of a quarter, they would be required to file Form GSTR-1 for the complete quarter, as the last applicable return.

[Source: GSTN (//www.gst.gov.in/) dated 06.07.2021]

Adjournments through GSTN Portal

• GSTN has a new functionality on its portal to request / seek adjournment for Personal Hearing (PH).
• The will enable adjournment of personal hearing already fixed and enable next date of personal hearing.
• On officer’s front, he can select the date and time and issue a PH notice
• A maximum of three adjournments can be requested.
• This will also enable seeking extension of time for filing of reply to SCN and enable uploading of supporting documents. 

[Source: GSTN Portal]

New functionalities on GSTN in July

Following new functionalities have been deployed / to be deployed on GSTN portal in July, 2021

Module	Form/ Functionality
Registration	Timelines for filing of Application for Revocation of Cancellation of Registration in Form GST REG-21
Returns	Information regarding late fee payable provided in Form GSTR-10
Returns	Auto-population of data in Form GSTR-11 on basis of Forms GSTR-1 / 5 filed by their suppliers

[Source: (//www.GST.GOV.IN/NEWSANDUPDATES) dated 09.07.2021]

New functionalities on GSTN for  Ledgers

• New functionalities on GST Portal regarding Ledgers  have been provided .
• All ledgers can be viewed for a period of 12 months (earlier  view for only 6 months was allowed).
• Negative liability ledger has also been made functional for composition dealers.

[Source: GSTN Portal]

GST Collections: Lower but promising

• Gross GST revenue collection for June, 2021 (5^th June to 5^th July, 2021) is ₹ 92849 crore, lower than ₹ 1 lakh crore, a bench mark since last eight months.
• Of ₹ 92849 crore, CGST is ₹ 16424 crore, SGST is ₹ 20397 crore, IGST is ₹ 49079 crore and cess is ₹ 6949 crore.
• Lower collection can be attributed to Covid hit lockdown in May, 2021 in most states of the country resulting in slowdown in business activities.
• However, June 2021 GST collection is still 2% higher than in June, 2020 (when national lockdown was there in May, 2020).
• E-way bills generated in May, 2021 were 3.99 crore only as compared to 5.88 crore in April, 2021, down by 30% indicating slowdown in economy. However, in June, 2021, it  again picked upto 5.5 crore.
• It is expected that GST revenue and economic activities will gain from July, 2021 onwards as lockdown have been lifted / eased now in most parts.

[Source: MOF, Press Release ID 1733074 dated 09.07.2021]