Traders can get enrolled under GST provisions at govt camps

The commercial taxes department (CTD) is to organize mega camps at all the nine divisional headquarters from Tuesday for mass enrolment/registration of traders and heads of business concerns and their units under the provisions of the goods and services tax (GST) regime, which is to be enforced in the country next year. The camps are being organized on the CTD premises in Patna, Gaya, Bhagalpur, Munger, Purnia, Saharsa, Darbhanga, Muzaffarpur and Chhapra.

Traders from the districts concerned could also get registered under GST at the camps. A senior CTD official in the rank of joint commissioner said anyone whose business unit's annual turnover is even Re 1 and carries tax identification number-value added tax (TIN-VAT) and/or TIN central sales tax (TIN-CST) should get registered under GST to reap the benefits of conducting interstate trade as would accrue from the new tax regime in the country.

"The registration done under GST at the camps will be free of cost. The CTD officials and employees will assist them," said the official, adding that mass registration has already started and would continue till December 15. The camps at the nine divisional headquarters would also continue till December 15. "The mass registration is being organized under mission mode," he said. The official said "migration to the GST mode" is mandatory for all traders having the TIN-VAT or TIN-CST and having annual turnover of Rs10 lakh or more. If they fail to avail of the opportunity for migration now, they would have to migrate to GST in April. "Those who do not migrate to the GST mode will not be able to conduct interstate trade.

That is, they will not be able to procure any item from outside state for trade within his or her state (read Bihar)," the official said, adding: "Those who do not migrate to the GST mode can trade only within the confines of Bihar." Asked as to what about the persons who are about to start any venture or trade or have started it only last month, the CTD official said such persons could "voluntarily register their concerns for TIN-VAT or TIN-CST and then "migrate to the GST mode".

"There is a relevant section, 19(1), of the VAT Act which facilitates voluntary registration under TIN-VAT and TIN-CST. After this, even they could migrate to the GST mode at the mega camps. It would also be free of cost," he said.

 (Times of India)

Centre to share model GST law with states today

 The Centre is also working on multiple options apart from 'horizontal' and 'vertical' division for deciding on jurisdiction over tax assessees, he said. The Centre will share the draft model GST law with the states today as it prepares for the rollout of Goods and Services Tax (GST) from April 1 next year, CBEC Chairman Najib Shah said. The Centre is also working on multiple options apart from 'horizontal' and 'vertical' division for deciding on jurisdiction over tax assessees, he said. "We are very hopeful of GST implementation from April 1, 2017. By tomorrow we will share the model GST law with the states which has been redrafted after taking into account the comments of stakeholders," Shah said while inaugurating the CBEC pavilion at the IITF. He said the Compensation law will be shared with the states on November 16 detailing the procedure for making good revenue loss of states in the first five years of GST rollout. The Central Board of Excise and Customs (CBEC) has taken up Goods and Services Tax as the theme for its IITF pavilion and it tries to educate people about the new taxation regime which is expected to roll out from April next year. The GST will subsume excise, service tax, VAT and other local levies and will help in smooth movement of goods and services across the country. The Centre and states have already decided on a four-tier GST rates-- 5, 12, 18 and 28 per cent-- but is yet to decide on the issue of cross empowerment to avoid dual control. Differences arose with the states demanding control over 11 lakh service tax assessees, and the Centre proposing to do away with the states having exclusive control over all dealers up to an annual revenue threshold of Rs 1.5 crore -- an issue which was settled in the first meeting of the GST Council. The Council has arrived at an option of two proposals -- horizontal division and vertical division. 'Horizontal division' would mean taxpayers would be divided both for administrative and audit purposes based on a cut off turnover. Those with a turnover over Rs 1.5 crore would be administered both by the Centre and states, while those with below Rs 1.5 crore would be administered solely by the states. Under the 'vertical division', taxpayers could be divided in a ratio which would balance the interest of the Centre and the state, both with respect to revenue and spread of numbers.

(Economic Times)

Enrolment in GST

Enrolment in GST begins at www.gst.gov.in. Delhi, Haryana, UP, Punjab from 16.12.2016 to 31.12.2016).  Gujarat, Maharastra 14.11.2016 to 29.11.2016. ST assessees in Jan 2017.

Multi-layered GST Complicated But Unavoidable

Say Tax Experts Tax experts are divided over the multi-layered goods and services tax finalised by the GST Council on Thursday. Some said the multi-layered GST is too complicated and undermine the key benefit of this reform, while others said having different tax slabs is unavoidable in a country like India and will help keep rates close to what is prevailing. “The multi-layered structure will see classification issues and complicate matters from transaction perspective especially for companies dealing with more than one product,“ said Bipin Sapra, partner (indirect taxes) at E&Y. “Overall it is a balanced structure as it would keep the change in tax incidence minimum as compared to today,“ he said. Rajeev Dimri, leader (indirect tax) at BMR & Associates, said that from the perspective of overall tax incidence, levy of cess on luxury items and demerit goods should be acceptable to the industry as these goods face a similar tax burden presently. “However, dealing with another tier of tax would be administratively difficult to handle, specifically given the short timeframe that the India Inc has in hand for setting up GST enabled systems,” he said. “Also modalities around levy of cess, viz point of levy, credit eligibility, etc. will be critical aspects to watch out for,” Dimri added. Effectively, there will be seven rates under the GST regime -exempt, 2-4% for gold, 5% for essential commodities, two standard rates of 12% and 18%, 28% rate and higher rate on demerit goods that includes a cess over and abo ve the 28% rate. Krishan Arora, director at Grant Thornton India, said that while the consensus on rate structure among the Centre and the states seems to be a step closer towards timely implementation of GST, the essence of the multiple split tax rates will need to pass the test of industry acceptance on grounds of revenue neutrality and zero cascading across sectors, specially go ods falling in the 28% bracket. Prashant Deshpande, partner at Deloitte Haskins & Sells, said the increase in maximum marginal rates to 28% coupled with the announcement that it will be applied to items currently taxed at rates in that range would mean that rate as a criteria would cease to play a role in evaluating benefits from GST for such products. Sandeep Chilana, partner at Shardul Amarchand Mangaldas, said while the present approach is a departure from international practice of single GST rate, this collaborative and consultative approach should successfully address the peculiar social, political and economic complexities in India. Earlier, NITI Aayog vice chair man Arvind Panagariya and finance minister Arun Jaitley have defended multi-layered tax rate. Panagariya had said such a system would ensure less inflationary implications and lower tax rates for consumers as well as revenue predictability for the exchequer. “A four slab rate structure for GST is better than going in one go on to a single rate as in the latter price effect on specific products could be substantial,” he had said. Jaitley had supported the multilayered structure on the pretext that similar structure exits elsewhere. “Some developed countries, which do not have any section of the population below the poverty levels and where economic standards are high, have three-four slabs,” he had said in his blog.

 (Business Standard)

GST Site to Open soon so Filing

 Online filing portal to be thrown open to public from next week and will allow tax payers to register themselves in advance and fill in their details Much before the April deadline of the roll-out of the Goods and Services Tax (GST), the online filing portal is ready to throw itself open to the public from next week, enabling tax payers to warm up to the new system before it finally launches in April of next year. On Thursday, the GST Council finalised a four-tier tax structure of 5, 12, 18 and 28% for the new tax regime, with lower rates for essential items and the highest for luxury and de-merits goods. According to a government official, the GST portal will be hosted at the domain http:www.gst.gov.in, which will be launched on November 8, even as the mobile app is currently being developed. “The proposal was discussed in the GST panel meeting today (Thursday) and the date has been finalised. There was no adverse reaction to it,“ said the official who requested anonymity. The portal will allow tax payers whose PAN numbers have been verified by the tax department to register themselves in advance and fill in their details and legacy data. “The idea is to avoid everyone trying to log-in at the same time before the roll-out in April,“ said the official adding that the government is looking at getting the tax payers to enter all the data about themselves in their system for it to work smoothly at the time of the launch wit hout any “challenges“. ET had reported earlier that India's second-largest software company Infosys has been mandated to develop and run the Goods and Services Tax Network (GSTN) -the entity tasked with providing the information technology infrastructure for it -in a project worth . 1,380 crore. The portal itself will ` be a one-stop destination for filing and processing of all taxes for almost 65 to 70 lakh tax payers in the country and is being designed by a specialised design unit of Infosys. The GST portal will be a front for the tax payer where registration, return and payments will be filed. It will also provide help-desk support. The technology at the backend will have the power to analyse data for trends on sales, tax filings etc. The portal will allow businesses to register using their PAN and mobile number or Aadhaar number. All businesses will be given a GST identification number, which will be a 15-digit code, consisting of their state code and ten-digit PAN.GSTN has already validated the PAN of 58 lakh businesses from the tax department over the past two years. The official added that GSTN has already generated the GST identification numbers for around 20 lakh tax payers in eight states and has sent the data to the states for further disbursal. The rest of the tax payers will be covered in batches over the coming weeks, said the official. “We are doing it right now for VAT which covers excise as well, since those paying excise are also registered for VAT. Registration for people paying service tax will begin in January,” said the official. The entity is also in the process of developing a mobile app through which tax payers can also register themselves and at the same time allow them to file taxes or upload returns. “We are making the process really simple by allowing people to just take pictures from their phone cameras and then upload them,“ said the official, adding that the app is also expected to be ready over the next five to seven days.


(Economic Times)

GST standard rate should be 26%

The peak rate should be set at more than 30 per cent and the lower rate be reduced to four per cent, said Kerala's Finance Minister Thomas Isaac after the GST Council meeting on Tuesday. He told Dilasha Seth that the states were satisfied with the decision arrived to compensate states. Edited excerpts:

What is your take on the Centre's four-tier GST rate structure?
The Centre has proposed a four-rate structure with a top rate of 26 per cent, standard rates of 18 per cent and 12 per cent and a low rate of six per cent. I would like to have the 26 per cent raised to 30 per cent-plus, which would enable us to bring down tax on necessities from six per cent to four per cent.

Will you back the standard rate of 18 per cent?
I would say that the standard rate should be 26 per cent, while the top rate should be increased to over 30 per cent. Common man's items can either be exempt or levied with lower tax rates. Hopefully, a decision on rates will be finalised in tomorrow (Wednesday)'s meeting.

What was the big outcome of today's meeting?
The major issue that's been resolved today is the compensation for states. Basically at what rate will it be taxed. A consensus between the Centre and the states was arrived at. Base year for calculating the revenue of a state would be 2015-16 with growth rate of 14 per cent to be taken to calculate the likely revenue for first five years. Almost all states demanded that.

(Business Standard)

GST Council mulls five rate slabs

Central government proposes two standard rates of 12% and 18% and 6% for essential goods; white goods and luxury products at 26% and gold at 4% On Day 1 of the three-day meeting of the goods and services tax (GST) Council, Finance Minister Arun Jaitley said five different rate structures were presented. At the same meeting, the central government proposed a four-rate structure with two standard rates of 12% and 18% and 6% for essential goods.
It proposed white goods and luxury products to be taxed at 26% and gold at 4%. The Council is also looking at a cess on demerit goods such ultra-luxury items, tobacco products and pan masala and environmentally harmful products in order to equalise the levy to the current level of tax. The cess will help the government raise an additional Rs 50,000 crore that would be used to compensate the states for their revenue losses. “The broad approach has been that the rate structure should be such that it does not lead to any further CPI (consumer price index) inflation, the states have adequate revenues, so should the Centre, to discharge their obligations and this has to be blended with only the least possible burden that has to be put on the tax payer,” Jaitley said.
Kerala Finance Minister Thomas Isaac said the rate structure proposed by finance ministry confirmed his “worst fear”. “Worst fears confirmed — GST to be regressive. Tax on luxuries to be reduced to 26% and on necessities to be raised to 12%,” he said, adding that the proposal for cess contradicted the original concept paper for GST.
A government panel headed by chief economic advisor (CEA) Arvind Surbamanian has recommended a four-tier rate structure with standard rate of around 17-18%, a 12% rate for essential goods, 2-6% for precious metals and a 40% for demerit goods. Bipin Sapra, tax partner, EY, believes a peak rate of 26% would be inflationary and cesses could to lead cascading effect. "The maximum rate of 26% for demerit or luxury goods may harbour more goods than initially envisaged which will make them costlier. Also since cesses would be outside the GST, the present cascading may continue raising the tax burden," he said in statement issued by EY. On Tuesday, the Council, chaired by Jaitley, concluded that the secular revenue growth rate for all states would be taken as 14%. The Council, which is represented by all states, also agreed on the definition of revenue under GST regime.
Consensus on these two issues paved the way for the Council to finalise the issue of compensation to states which would lose revenues under GST. “With these two decisions (definition of revenue and annual revenue growth rate of 14%), the issue with regard to calculation of compensation itself was concluded in the discussions today,” Jaitley told the media after the meeting. He said the 14% growth rate was arrived at by taking the average of revenue rates, ranging from 10% to 18%, from all formulae. The Council will meet again today to further deliberate on the GST rate structure. In the last meeting, the Council had decided to agree on all issues by November 22. The finance ministry would try to get a consensus on all issues to push through Central GST (CGST) and Integrated GST (IGST) legislations in the Winter Session of Parliament beginning November 16. Thomas expected a “broad structure of the GST rates to emerge by today evening”.
Jaitley said once the rate structure was finalised, the technical group of officers would decide which items of goods and services went under which category. After finalisation of the GST rate, the union minister said the Council will take up the “inconclusive item of the last meeting with regards to cross-empowerment”.

(www.dnaindia.com)

PPT ON GST

http://www.cbec.gov.in/resources//htdocs-cbec/deptt_offcr/gst-dgtps-12092016.pdf

GST – Draft Rules and formats

Draft Rules and formats have been issued by Central Board of Excise and Custom for Registration, Payment and Invoice.

• Draft Registration Rules
• Draft Registration formats
• Draft Payment Rules
• Draft Payment formats
• Draft Invoice Rules
• Draft Invoice formats

Threshold limit of 10 lakhs to be applicable in respect to following states:

1. Arunchal Pradesh
2. Assam
3. Jammu & Kashmir
4. Manipur
5. Meghalya
6. Mizoram
7. Nagaland
8. Sikkim
9.Tripura
10. Himachal Pradesh
11. Uttarakhand

If a taxpayer has a principal place of business in states other than mentioned above, the threshold limit will be 20 lakhs even if any branch/warehouse is situated in specified states.

For Ex: A taxpayer's principal place of business is in Delhi and it also has a branch/warehouse in Himachal Pradesh, then his threshold limit will be 20 lakhs

GSTN (Times Business) Dated 26 Sep 2016

Times Business (September 24,2016)

GST Council Meeting

1. GST threshold limit to be kept at 10 lakhs for hill area states and NE as against 20 lakh in other states.

2. All cesses to be subsumed under GST.

3. Separate Law for compensating states on any loss due to GST. Base year for compensation to be FY 2015-16.

4. Cross Empowerment model for assessees having annual turnover exceeding  1.5 crores.

5. Only 5% of the taxpayers to be covered under audit as against 70-80% under various state laws.

6. State to be compensated if its revenue under GST falls short of the average tax earnings in the best three years out of five years.

7. Next meeting of council on September 30.

8. States to monitor the taxpayers with annual turnover of less than 1.5 crores. Although the service tax assessees to remain with center only

Ist GST Panel Meet --Agenda (Times Business Page)

GST Council to decide on cess treatment

 Cess, including the Krishi Kalyan Cess and the Swachh Bharat Cess, might not be subsumed under the goods and services tax (GST). The proposed indirect tax regime would subsume several taxes such as central excise duty, services tax, additional customs duty and state- level value added tax. But, finance ministry officials said, the Constitution amendment Act on GST does not state how a cess is to be treated under the new regime.
The Act leaves it to the GST Council to decide which cess may be subsumed in GST. “While certain taxes like entry tax, Octroi and others will be automatically subsumed under the GST, the Constitution amendment Bill does not mention treatment of cesses,” said a government official. “So, there is a possibility that Krishi Kalyan and Swachh Bharat cess are not subsumed, unless the GST Council decides to discontinue these. The call will have to be taken up by the GST Council now.” In the current financial year, the government has budgeted Rs.10,000 crore as revenue from Swachh Bharat Cess, Rs. 5,000 crore from Krishi Kalyan Cess and Rs. 3,000 crore from Infrastructure Cess. Satya Poddar of EY said the Centre can retain these cess, if it wants to.
Explaining this, he said surcharge is a tax on tax and hence would go once entries containing the principal taxes are deleted. However, a cess is not a tax and it does not go into the Consolidated Fund of India, he explained. Cess is imposed for specific purpose such as education, cleanliness etc. The Constitution amendment Act on GST omit entry 92 C of the Seventh Schedule under which the union government imposes services tax. Similarly, it amends entry 84 of the Seventh Schedule under which the union government levies excise duty to keep only some petroleum and tobacco and its products under it. So, any surcharges imposed on these would automatically go.
However, the Act does not amend relevant entries of cess, including entry 97 of the Seventh Schedule, which deals with residuary powers of the Union government. So, if the Centre decides they can retain these.” The statement and objects of the Act also talk about subsuming cess into GST. “ Hence there is inconsistency in the Act and its statement and objects,” Poddar added. A government official said if the taxes continue, these would be levied on GST, instead of only services or goods. “These cesses were put in place by the government for a very specific purpose, whether it is infra cess, Krishi Kalyan or Swachh Bharat,” he said.
Talks are on with the ministries concerned on a compensation mechanism if these cess are discontinued. “We are talking to agriculture ministry, drinking water and sanitisation ministry and others to get their views.” The Centre does not share cess with states, while all taxes under GST will have to be shared with the states. In 2014- 15, Rs. 75,232 crore came in as cess and surcharge, or 8.32 per cent of total tax revenue, after adjusting for states’ share. As petroleum is expected to be taxed at zero under the GST regime initially, the Centre will continue with the cess on crude oil and other related additional duties.

(Business Standard)

FinMin clears legal cloud on GST Act

The finance ministry on Monday clarified there was no legal problem in the notification of the Constitution amendment Act on the goods and services. On Sunday, speculations were rife that the government might have to re- notify the Act as existing wording would not allow it to impose excise duty on goods. “DoR (the department of revenue) examined the validity and implications of notifications dated 10 and 16 September, with respect to existing taxes imposed by the Union and states. There is no legal infirmity in these notifications,” Revenue Secretary Hasmukh Adhia said in his tweets. He added the law department had confirmed there appeared to be no legal requirement. In a notification, the finance ministry had constituted the GST Council September 10. Sources said the confusion arose from a second notification, where it notified provisions of 19 sections under the Act, to come into force from September 16. Among these notifications, most of the complications were interpreted to have come from provisions of Section 17 of the Act. The provisions said in entry 84 of the seventh schedule of the Constitution, under which the government imposes central excise duty, petroleum and tobacco would replace other items. This was meant to assume that the government would lose its power to impose the excise duty on other goods since the provision has come into force from September 16. Pratik Jain, leader, indirect tax, PWC, said the notification had, in fact, created some issues. On Sunday, Adhia had tweeted that some questions were raised about the notifications issued recently in respect of GST Constitution Amendment Act. The finance ministry, he had tweeted, would clarify the correct legal position on Monday and issue amendments if need be.

(Business Standard)

Provision Related to Job Work U/S 43A of Model GST Law

1) Registered Taxable Person Can send taxable goods to Job Worker without Payment of Tax, provided a permission is taken In advance from the Commissioner.

2) One Job Worker can further send the good to another job worker without payment of Tax.

3) The Good after Processing can be brought back at Principle place without payment of tax. And finally tax will be paid when such goods are further supplied by the Principle.

4) The goods can also be supplied to customer from Job Worker Place on payment of Tax and in case of export without payment of Tax.
It must be noted that goods can be supplied directly from the place of business of job worker by the principal *only when the principal declares the place of business of the job worker as his additional place of business*. However, the exceptions are -
(a) If job worker is registered under Section 19;
(b) The principal is engaged in the supply of notified goods.

Cabinet approves creation of GST Council and its Secretariat

The Union Cabinet under the Chairmanship of Prime Minister Shri Narendra Modi has approved setting up of GST Council and setting up its Secretariat as per the following details:

(a) Creation of the GST Council as per Article 279A of the amended Constitution;

(b) Creation of the GST Council Secretariat, with its office at New Delhi;

(c) Appointment of the Secretary (Revenue) as the Ex-officio Secretary to the GST Council;

(d) Inclusion of the Chairperson, Central Board of Excise and Customs (CBEC), as a permanent invitee (non-voting) to all proceedings of the GST Council;

(e) Create one post of Additional Secretary to the GST Council in the GST Council Secretariat (at the level of Additional Secretary to the Government of India), and four posts of Commissioner in the GST Council Secretariat (at the level of Joint Secretary to the Government of India).

The Cabinet also decided to provide for adequate funds for meeting the recurring and non-recurring expenses of the GST Council Secretariat, the entire cost for which shall be borne by the Central Government. The GST Council Secretariat shall be manned by officers taken on deputation from both the Central and State Governments.

The steps required in the direction of implementation of GST are being taken ahead of the schedule so far.

The Finance Minister has also decided to call the first meeting of the GST Council on 22nd and 23rd September 2016 in New Delhi.

Background:

The Constitution (One Hundred and Twenty-second Amendment) Bill, 2016, for introduction of Goods and Services tax in the country was accorded assent by the President on 8th September, 2016, and the same has been notified as the Constitution (One Hundred and First Amendment) Act, 2016. As per Article 279A (1) of the amended Constitution, the GST Council has to be constituted by the President within 60 days of the commencement of Article 279A. The notification for bringing into force Article 279A with effect from 12th September, 2016 was issued on 10th September, 2016.

As per Article 279A of the amended Constitution, the GST Council which will be a joint forum of the Centre and the States, shall consist of the following members: -

a) Union Finance Minister - Chairperson
b) The Union Minister of State,
in-charge of Revenue of finance - Member
c) The Minister In-charge of finance or
taxation or any other Minister nominated
by each State Government - Members

As per Article 279A (4), the Council will make recommendations to the Union and the States on important issues related to GST, like the goods and services that may be subjected or exempted from GST, model GST Laws, principles that govern Place of Supply, threshold limits, GST rates including the floor rates with bands, special rates for raising additional resources during natural calamities/disasters, special provisions for certain States, etc.

*****

AKT/VBA/AK

Salient features of the proposed Indian GST system

--The power to make laws in respect of supplies in the course of inter-state trade or commerce will be vested only in the Union Government. States will have the right to levy GST on intra-state transactions, including on services.
--The Centre will levy IGST on inter-state supply of goods and services. Import of goods will be subject to basic customs duty and IGST.
--GST is defined as any tax on supply of goods and services other than on alcohol for human consumption.
--Central taxes such as Central Excise duty, Additional Excise duty, Service tax, Additional Custom duty and Special Additional duty as well as state-level taxes such as VAT or sales tax, Central Sales tax, Entertainment tax, Entry tax, Purchase tax, Luxury tax and Octroi will subsume in GST.
--Petroleum and petroleum products, i.e., crude, high speed diesel, motor spirit, aviation turbine fuel and natural gas, shall be subject to GST - date to be notified by the GST Council.
--Provision will be made for removing imposition of entry tax /Octroi across India.
--Entertainment tax,, imposed by states on movie, theatre, etc., will be subsumed in GST, but taxes on entertainment at panchayat, municipality or district level will continue.
--GST may be levied on the sale of newspapers and advertisements. This would mean substantial incremental revenues for the Government.
--Stamp duties, typically imposed on legal agreements by states, will continue to be levied.
--Administration of GST will be the responsibility of the GST Council, which will be the apex policy making body for GST. Members of GST Council comprise Central and State ministers in charge of the finance portfolio.

GST --Road So Far