Government Might Bring Changes in GST Rules to Simplify Filing Process

After the reduction of tax rates nearly on 300 items in last GST council meeting, now the government is planning to bring some changes in the rules, procedures and regulations under GST to simplify the procedures for taxpayers and businesses.

The changes might include making the filing process easier and some for the composition scheme. The law advisory group will also discuss whether to bring reverse charge mechanism (RCM), tax deducted at source (TDS) and tax collected at source (TCS) under GST or not, as reported by a leading news website.

It is anticipated that the government will propose some major changes in the next GST Council Meeting, which will be held in the first week of January in New Delhi.

A report will be submitted by the law advisory group on 1st January 2018 detailing important suggestions. The report consists of the rectifications of rules, regulations, and laws to simplify the new indirect tax regime said an official.

A certain amount of rectifications are also needed in the five major GST laws including – Central GST (CGST), State GST (SGST), Integrated (IGST), Union Territory GST (UTGST) and GST (Compensation to states). The rectifications will take place after the declaration of the Union Budget in February.

Read Also: Full Definition of SGST, IGST, CGST with Input Tax Credit Adjustment

“The law review group will see what provisions need to be changed. Traders concerns will definitely be addressed. For example, how do we deal with TDS and TCS under GST? Do we need the concept of invoice-matching?” the official said.

Since 1st July, the indirect tax regime is facing tough times owing to several factors, mainly because of the technical glitches at GSTN portal, errors in invoice matching, lack of clarity on return filing and more.

Due to the technical glitches at GSTN portal, the government had to extend the dates of filing returns many times. In respect of making the filing process easier, a month ago – the Council has permitted taxpayers to file only two set of forms which includes GSTR 1 (for outward supplies or goods that they sell) and GSTR 3B (summary form); earlier it was four.

At 23rd GST Council meeting, the annual threshold limit has been extended by the government from Rs 1 crore to Rs 1.5 crore. Businesses with an annual turnover of less than Rs 1.5 crores will have to file returns quarterly instead of monthly whereas those having a turnover of more than Rs 1.5 crores per annum will have to file monthly returns.

It is assumed that the return filing process will change completely and the concept of invoice matching might not exist. Other officials said that “There are various possibilities such as bringing in fresh return forms and formats.”

The law advisory committee will decide on whether the concepts like RCM, TDS, and TCS should be brought under new indirect tax system or not. Currently, the Council has postponed all of the above decisions until March 2018.