Myth 01: The bigger number of the assessee will be influenced by the rule.
Fact: For several privileges such as exporters, suppliers of goods of inverted duty structure, assesses who have a footstep in the Income Tax database, etc. it is thought that this rule will be applied to only 0.5% of the total assesses which is 1.2 cr. From this rule, the identification of the risk to revenue is higher and affects a discouragement to the pretenders in the multilevel fraud of giving the ITC.
This law will assist to control these fake persons, who are mentioning higher turnovers by giving the fake invoices, while the provided credentials have no financial makeover and disappear post to misuse the income tax credit excluding the payment of any tax liability for cash.
Myth 02: There will be a load on small businesses and enhance their working capital need due to the need for a cash payment of 1% liability.
Fact: 1% cash payment is to be computed on the tax liability in the month and not on the turnover of the month. It is only 0.01% of turnover. For instance, if the dealer is doing the sales of Rs 1 cr of the goods whose tax prices are 12% and if the person is giving 99% tax liabilities via ITC, then he only has to pay Rs 12000 below the rule. Besides that Rs 1 lakh, cash with sales volume is to be furnished by the composition dealer.
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Myth 03: Small as well as medium companies will be affected by this rule.
Fact: The new procurement which limits the ITC usage to release output liability is applied to the enrolled person whose value of taxable supply other than privilege supply and export for a month is more than Rs 50,00,000, which clarifies that those whose yearly turnover exceeds Rs 6 cr. thus the rule will not be applied to micro and small businesses 
Myth 04: Every enrolled individual is urged to pay 1% cash liability.
Fact: This rule is applied to the enrolled individual for those whose taxable supply value excluding the privileged supply and export in the month of more than Rs 50 lakh which reveals the yearly turnover exceeds Rs 6 cr. this rule is not applied for the event in which the enrolled person:
- Rs 1 lakh or more is provided as the income tax in each of the last 2 years.
- In the previous fiscal year, a refund exceeding Rs 1 lakh has been collected for the export or inverted tax platform.
- Has given the paid output tax via cash in excess of 1% out of total output tax liability applicable for the month of the present fiscal year.
- It is a government authority, PSU, local authority, statutory body.
