Maharashtra state government has come forward with new one-time GST amnesty schemes to get rid of the backlog of tax assessments which is pending from before the initiation of the goods and services tax regime.
Maharashtra has announced the amnesty scheme to completely eradicate the pre-GST tax disputes and to ensure the retrieval of outstanding taxes to the government.
GST brought uniformity with one tax for one nation but prior GST each state had its own rules and regulation regarding taxes. This is the reason why many industrialists were insisting upon the introduction for such schemes to dismiss the unresolved past issues.
As informed by experts, at present, business has manifold unsettled issues across states & VAT assessments in various states are yet due with an accumulation of 2-3 VAT assessment for every dealer in every single state. Most tax administration officials in states have switched on to GST but there are still few lefts who are following the older tax policies and adding up the pileup.
After Karnataka and West Bengal, Mumbai has declared the scheme with a resolute to curtail the arrears of taxes and other amounts which existed prior Goods and Services Tax regime which came into force on July 1, 2017.
The scheme grants waiver of arrears under various state levies, including VAT, CST, entry tax, professional tax, luxury tax, and purchase tax on sugarcane. However, the scheme doesn’t entertain any undisputed tax which contains taxes shown payable in the returns filed.
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The scheme is valid for the taxpayers who filed their relevant tax returns on or before July 15, 2019. According to Tax experts, this scheme will help the industry and the government in two ways:
- Resolution of past litigation
- Adoption of the new tax regime.
“This initiative by the Maharashtra Government to provide a one-time settlement window for old disputes, wherein tax, interest, and penalty is waived (either in full or part), is a move towards the right direction,” said Pratik Jain, national leader, indirect tax, at PwC. “Waiver from tax, in addition to interest and penalties, might make it a very attractive proposition for taxpayers.”
“This will not only help in revenue collection but also ensure that tax administration focus on GST audits/scrutiny, where the collection target for next year appears to be steep,” he said.
Jain expressed his views on the new scheme calling it a beneficial step for the central government as it serves similar rules for both, the excise and the service tax.
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Government’s launch of One-Time GST Amnesty Scheme will surely bring great relief to GST Defaulters and Government as well.
