The rule is regulated to ensure that consumers should not suffer in the name of Goods and Services Tax (GST). It will be mandatory by November to follow the rule strictly.
The first target of Commercial Taxes Department is to concentrate on taxpayers who opted for Composition Scheme. As under Composition Scheme, the small businesses could not charge the tax from the consumers. Therefore, it will be mandatory for small businesses to display on their premises that they are “availing of the composite scheme and are not entitled to collect taxes from people.” Recently, the tax department got known by the fact that composition scheme holders are charging the tax from the local consumer in a wake of saying GST collection. The scheme is initiated to reduce the compliance cost for small businesses who are not able to make frequent refunds in a month and the contradictory is not expected from composition dealers.
The composition dealers are caught while propelling and frightening the consumer that if they ask for a bill, they would have to pay GST taxes in a new indirect tax system.
In the direction to make the rule smooth for all, it becomes important to mandate the rule strictly so no one suffers under tax burden. An anonymous official said regarding the rule implementation, “That is the legal requirement. Citizens can find out whether the person from whom he is buying is entitled to collect tax from him or not.” The composition scheme is designed for small businesses whose turnover is up to Rs. 1 Crore and they are offered to file the returns at a constant rate under the new indirect tax system without availing the input credits. In the 22nd meeting of GST council, the last date for registering or opting out under composition scheme is 31st October.
Under composition scheme, there are total 20,000 registered composition dealers to pay tax at the rate of 1%,2%, and 5%. Here, a dealer pays tax at the rate of 1%, a manufacturer at 2% and the restaurants at 5%.
