TMI BlogBUDGET 2022-2023 AND FINANCE BILL, 2022- MAJOR CHANGES IN GST LAWX X X X Extracts X X X X X X X X Extracts X X X X ..... BUDGET 2022-2023 AND FINANCE BILL, 2022- MAJOR CHANGES IN GST LAW - By: - Dr. Sanjiv Agarwal - Goods and Services Tax - GST - Dated:- 7-2-2022 - - The Union Budget 2022-23 which has been presented in Parliament by Finance Minister on 1 st February, 2022, had the following vision in mind: Complementing the macro-economic level growth focus with a micro-economic level all-inclusive welfare focus, Promoting digital economy fintech, technology enabled development, energy transition, and climate action, and Relying on virtuous cycle starting from private investment with public capital investment helping to crowd-in private investment. Though no announcements were made for GST amendments in the speech yet, a large number of important changes have been proposed in GST law in Finance Bill, 2022 . Changes have been made in indirect taxes including GST and Customs. On GST, it has been stated that GST has been a landmark reform of Independent India showcasing the spirit of Cooperative Federalism. While aspirations were high, there were huge challenges too. These challenges were overcome deftly and painstakingly under the guidance and oversight of the GST Council. We c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an now take pride in a fully IT driven and progressive GST regime that has fulfilled the cherished dream of India as one market- one tax. There are still some challenges remaining and we aspire to meet them in the coming year. The right balance between facilitation and enforcement has engendered significantly better compliance. GST revenues are buoyant despite the pandemic. Taxpayers deserve applause for this growth. Not only did they adapt to the changes but enthusiastically contributed to the cause by paying taxes. Certain changes have been made in the GST Acts and the IGST Act on the basis of recommendation made by the GST Council. These changes will come into effect from the date to be notified. These changes broadly relates to facilitation/simplification and for improving compliance. These changes include rationalisation of return filing procedure, sequential filing of GSTR-1 , cancellation of registration of return non-filers/ stop-filers, doing away with two-way communication process in return filing and consequent changes related thereto, certain conditional restrictions on utilisation of input tax credit, allowing transfer in electronic cash ledger of a distinct per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... son, extending the relevant date for rectification of errors, availing input tax credits, issuance of credit or debit note pertaining to a financial year till 30th November of following financial year, etc. Also, section 50 of the CGST Act has been amended to prescribe, with effect from 1st July, 2017, levy of interest on wrongly availed ITC only if it is utilised. Tax Proposals: Highlights Indirect Taxes Buoyant GST collections during 2021-22 (Rs. lakh crore) Customs administration to be fully IT driven in SEZs Phasing out concessional rates in capital goods and project imports gradually and apply a moderate tariff of 7.5% Review of customs exemptions and tariff simplification Customs duty rates are being calibrated to provide a graded rate structure to facilitate domestic electronics manufacturing Rationalization of exemptions on implements and tools for agri sector manufactured in India Extension of customs duty exemption to steel scrap Reduction of duty on certain inputs required for shrimp aquaculture. Direct Taxes Tax relief to persons with disability Reducing alternate minimum tax rate and surcharge for cooperatives ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Extending period of incorporation of eligible startups for providing tax incentives Income from transfer of virtual assets to be taxed at 30% Better litigation management to avoid repetitive appeals Any surcharge or cess on income and profits not allowable as business expenditure Increasing tax deduction limit on employer s contribution to NPS account of state Government employees Allowing taxpayers to file updated return within 2 years for correcting errors. Break-up of Revenue Receipts at a Glance (Rs. in crores) Tax Revenue 2020-21 Actuals 2021-2022 Budget Estimates 2021-2022 Revised Estimates 2022-23 Budget Estimates Gross Tax Revenue 2027104 2217059 2516059 2757820 Corporation Tax 457719 547000 635000 720000 Taxes on Income 487144 561000 615000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 700000 Wealth Tax 12 - - - Customs 134750 136000 189000 213000 Union Excise Duties 391749 335000 394000 335000 Service Tax 1615 1000 1000 2000 GST 548778 630000 675000 780000 CGST 456334 530000 570000 660000 IGST 7251 - - - GST Compensation Cess 85192 100000 105000 120000 Taxes of Union Territories 5336 7059 7059 7820 Budget Amendments in GST Laws The Finance Bill, 2022 has made the following amendments in the CGST ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... / IGST / UTGST Acts, 2017 : Clause of Finance Bill, 2022 Section of CGST Act, 2017 Relating to Objective as per Notes on Clauses 99 16 Amendment of section 16 Clause 99 seeks to amend section 16 of the Central Goods and Services Tax Act, 2017 by inserting a new clause (ba) in sub-section (2) thereof, so as to provide that input tax credit with respect to a supply may be availed only when such credit has not been restricted in the details communicated to the registered person under section 38. It further seeks to amend sub-section (4) so as to provide that a registered person shall not be entitled to take input tax credit in respect of any invoice or debit note after the thirtieth day of November following the end of the financial year to which such invoice or debit note pertains, or furnishing of the relevant annual return, whichever is earlier. 100 29 Amendment of section 29 Clause 100 seeks to amend clause (b) of sub-section (2) of section 29 of the Cen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tral Goods and Services Tax Act so as to provide that the registration of a person paying tax under section 10 is liable to be cancelled if the return for a financial year has not been furnished beyond three months from the due date of furnishing of the said return. It further seeks to amend clause (c) of the said sub-section (2) so as to provide for prescribing continuous tax periods for which return has not been furnished, which would make a registration liable for cancellation, in respect of any registered person, other than a person specified in clause (b) thereof. 101 34 Amendment of section 34 Clause 101 seeks to amend sub-section (2) of section 34 of the Central Goods and Services Tax Act so as to provide for thirtieth day of November following the end of the financial year, or the date of furnishing of the relevant annual return, whichever is earlier, as the last date for issuance of credit notes in respect of any supply made in a financial year. 102 37 Amendment of section 37 Clause 102 seeks to amend sub-section (1) of sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 37 of the Central Goods and Services Tax Act so as to provide for prescribing conditions and restrictions for furnishing the details of outward supply and the conditions and restrictions as well as manner and time for communication of the details of such outward supplies to concerned recipients. It further seeks to omit sub-section (2) and first proviso to sub-section (1) so as to do away with two-way communication process in return filing. It also seeks to amend sub-section (3) so as to remove reference to unmatched details under section 42 or section 43 , as the said sections are proposed to be omitted, and to provide for thirtieth day of November following the end of the financial year or furnishing of the relevant annual return, whichever is earlier, as the last date for rectification of errors or omission in respect of details of outward supplies furnished under sub-section (1). It also seeks to insert sub-section (4) so as to provide for tax period-wise sequential filing of details of outward supplies under sub-section (1). 103 38 Substitution of new section for section 38 Clause 103 seeks to su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bstitute a new section for section 38 of the Central Goods and Services Tax Act. Sub section (1) seeks to provide for prescribing such other supplies as well as the manner, time, conditions and restrictions for communication of details of inward supplies and input tax credit to the recipient by means of an auto-generated statement and to do away with two-way communication process in return filing. Sub-section (2) seeks to provide for the details of inward supplies in respect of which input tax credit may be availed and the details of supplies on which input tax credit cannot be availed by the recipient. 104 39 Amendment of section 39 Clause 104 seeks to amend sub-section (5) of section 39 of the Central Goods and Services Tax Act so as to provide that the non-resident taxable person shall furnish the return for a month within thirteen days after the end of the month or within seven days after the last day of the period of registration specified under sub-section (1) of section 27 , whichever is earlier. It further seeks to substitute the first proviso to sub-section (7) so as to provide an option t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the persons furnishing return under proviso to sub-section (1) to pay either the selfassessed tax or an amount that may be prescribed. It also seeks to amend sub-section (9) by removing reference of section 37 and section 38 and to amend the proviso to said sub-section (9) so as to provide for thirtieth day of November following the end of the financial year, or the date of furnishing of the relevant annual return, whichever is earlier, as the last date for the rectification of errors in the return furnished under section 39 . It also seeks to amend sub-section (10) so as to provide for furnishing of details of outward supplies of a tax period under sub-section (1) of section 37 as a condition for furnishing the return under section 39 for the said tax period. 105 41 Substitution of new section for section 41 Clause 105 seeks to substitute a new section for section 41 of the Central Goods and Services Tax Act so as to do away with the concept of claim of eligible input tax credit on a provisional basis and to provide for availment of self-assessed input tax credit subject to such conditions a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd restrictions as may be prescribed. 106 42 /43 / 43A Omission of sections 42 , 43 and 43A Clause 106 seeks to omit section 42 of the Central Goods and Services Tax Act relating to matching, reversal and reclaiming of input tax credit so as to do away with the concept of claim of eligible input tax credit on a provisional basis and subsequent matching, reversals and reclaim of such credit. It further seeks to omit section 43 relating to matching, reversal and reclaim of reduction in output tax liability so as to do away with two-way communication process in return filing. It also seeks to omit section 43A . 107 47 Amendment of section 47 Clause 107 seeks to amend sub-section (1) of section 47 of the Central Goods and Services Tax Act so as to provide for levy of late fee for delayed filing of return under section 52 and to remove reference of section 38 as there is no requirement of furnishing details of inward supplies by the registered person under the said section 38 . 108 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 48 Amendment of section 48 Clause 108 seeks to amend sub-section (2) of section 48 of the Central Goods and Services Tax Act so as to remove reference to section 38 therefrom as there is no requirement of furnishing details of inward supplies by the registered person under the said section 38 . 109 49 Amendment of section 49 Clause 109 seeks to amend sub-section (4) of section 49 of the Central Goods and Services Tax Act so as to provide for prescribing restrictions for utilizing the amount available in the electronic credit ledger. It further seeks to amend sub-section (10) so as to allow transfer of amount available in electronic cash ledger under the Central Goods and Services Tax Act of a registered person to the electronic cash ledger under the said Act or the Integrated Goods and Services Tax Act of a distinct person. It also seeks to insert sub-section (12) so as to provide for prescribing the maximum proportion of output tax liability which may be discharged through the electronic credit ledger. 110 50 Am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... endment of section 50 Clause 110 seeks to substitute a new sub-section for sub-section (3) of section 50 of the Central Goods and Services Tax Act, retrospectively, with effect from the 1st July, 2017, so as to provide for levy of interest on input tax credit wrongly availed and utilised, and to provide for prescribing manner of calculation of interest in such cases. 111 52 Amendment of section 52 Clause 111 seeks to amend proviso to sub-section (6) of section 52 of the Central Goods and Services Tax Act so as to provide for thirtieth day of November following the end of the financial year, or the date of furnishing of the relevant annual return, whichever is earlier, as the last date upto which the rectification of errors shall be allowed in the statement furnished under sub-section (4). 112 54 Amendment of section 54 Clause 112 seeks to amend proviso to sub-section (1) of section 54 of the Central Goods and Services Tax Act so as to explicitly provide that claim of refund of any balance in the electronic cash le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dger shall be made in such form and manner as may be prescribed. It further seeks to amend sub-section (2) so as to align it with sub-section (1) by providing time limit of two years from the last day of the quarter in which the supply was received for claiming refund of tax paid on inward supplies of goods or services or both by the person specified in the said sub-section. It also seeks to amend sub-section (10) so as to extend the scope of the said sub-section to all types of refund claims. It also seeks to insert a new sub-clause (ba) in clause (2) of Explanation in order to provide clarity regarding the relevant date for filing refund claim in respect of supplies made to a Special Economic Zone developer or a Special Economic Zone unit. 113 168 Amendment of section 168 Clause 113 o seeks to amend sub-section (2) of section 168 of the Central Goods and Services Tax Act so as to remove reference to section 38 therefrom. 114 146 Amendment of notification issued under section 146 of Central Goods and Services Tax Act read with section 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Integrated Goods and Services Tax Act , retrospectively Clause 114 seeks to amend notification number G.S.R. 58(E), dated the 23rd January, 2018 to notify www.gst.gov.in, retrospectively, with effect from 22nd June, 2017, as the Common Goods and Services Tax Electronic Portal, for all functions provided under Central Goods and Services Tax Rules, 2017, save as otherwise provided in the notification issued vide number G.S.R. 925 (E), dated the 13th December, 2019 . 115 54 / 56 Amendment of notification issued under sub-sections (1) and (3) of section 50 , sub-section (12) of section 54 and section 56 of Central Goods and Services Tax Act, retrospectively Clause 115 seeks to amend notification number G.S.R. 661(E), dated the 28th June, 2017, so as to notify rate of interest under sub-section (3) of section 50 of the Central Goods and Services Tax Act as 18%, retrospectively, with effect from the 1st day of July, 2017. 116 9 Retrospective exemption from, or levy or collection of, central tax in certain cases. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Clause 116 seeks to provide retrospective exemption from central tax in respect of supply of unintended waste generated during the production of fish meal (falling under heading 2301), except for fish oil, during the period from the 1st day of July, 2017 upto the 30th day of September, 2019 (both days inclusive). It further seeks to provide that no refund shall be made of the said tax which has already been collected. 117 7 Retrospective effect to Notification issued under sub-section (2) of section 7 of Central Goods and Services Tax Act. Clause 117 seeks to give retrospective effect to the notification of the Government of India in the Ministry of Finance (Department of Revenue) number G.S.R. 746(E), dated the 30th September, 2019 with effect from the 1st day of July, 2017. It further seeks to provide that no refund shall be made of the central tax which has already been collected 118 20 Amendment of notification issued under section 20 of Integrated Goods and Services Tax Act, 2017 read with subsections (1) and (3) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 50 , sub-section (12) of section 54 and section 56 of Central Goods and Services Tax Act, retrospectively. Clause 118 seeks to amend notification number G.S.R. 698(E), dated the 28th June, 2017 , so as to notify rate of interest under sub-section (3) of section 50 of the Central Goods and Services Tax Act as 18%, retrospectively, with effect from the 1st day of July, 2017. 119 9 Retrospective exemption from, or levy or collection of, integrated tax in certain cases. Clause 119 seeks to provide retrospective exemption from integrated tax in respect of supply of unintended waste generated during the production of fish meal (falling under heading 2301), except for fish oil, during the period from the 1st day of July, 2017 upto the 30th day of September, 2019 (both days inclusive). It further seeks to provide that no refund shall be made of the said tax which has already been collected. 120 20 Retrospective effect to notification issued under clause (i) of section 20 of Integrated Goods and Services Tax Act read with sub-section (2) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f section 7 of Central Goods and Services Tax Act. Clause 120 seeks to give retrospective effect to the notification of the Government of India in the Ministry of Finance (Department of Revenue) number G.S.R. 745(E), dated the 30th September,2019 with effect from the 1st day of July,2017. It further seeks to provide that no refund shall be made of the integrated tax which has already been collected. 121 50/54/56 Amendment of notification issued under section 21 of Union Territory Goods and Services Tax Act read with sub-sections (1) and (3) of section 50 , sub-section (12) of section 54 and section 56 of Central Goods and Services Tax Act, retrospectively. Clause 121 seeks to amend notification number G.S.R. 747(E), dated the 30th June, 2017 , so as to notify rate of interest under sub-section (3) of section 50 of the Central Goods and Services Tax Act as 18%, retrospectively, with effect from the 1st day of July, 2017. 122 9 Retrospective exemption from, or levy or collection of, union territory tax in certain cases. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Clause 122 seeks to provide retrospective exemption from Union territory tax in respect of supply of unintended waste generated during the production of fish meal (falling under heading 2301), except for fish oil, during the period from the 1st day of July, 2017 upto the 30th day of September, 2019 (both days inclusive). It further seeks to provide that no refund shall be made of the said tax which has already been collected. 123 21 Retrospective effect to notification issued under clause (i) of section 21 of Union Territory Goods and Services Tax Act read with sub-section (2) of section 7 of Central Goods and Services Tax Act. Clause 123 seeks to give retrospective effect to the notification of the Government of India in the Ministry of Finance (Department of Revenue) number G.S.R. 747(E), dated the 30th September, 2019 with effect from the 1st day of July, 2017. It further seeks to provide that no refund shall be made of the Union territory tax which has already been collected. - - Scholarly articles for knowledge sharing authors experts professionals Tax Management Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ia - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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