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Several Industries Demands GST Benefit Pass Away Certificates

GST Benefits

Now even the B2B i.e. business to business merchants are in the queue to obtain certification of passing benefits to the consumers from the final vendors and retailers in order to corner down the anti-profiteering clause that may hamper there otherwise obligation if paid no concern. Various industries such as shipping, ports, electricity distribution and oil and gas still doubt upon the vendors that they might not be forwarding benefits to the consumers.

In this direction, many of the companies have asked for detailed certificates including all the sales material ranging from top to bottom or in all possible hierarchy. While asking for certificates is another factor, the point is many of the retailers and vendors are unable to produce such certificates. As told by a reputed form in taxes and consultancy, “Several companies are being asked by their customers to declare that benefits in terms of increased input tax credits or lower tax rates in GST have been passed on to them. In the absence of any prescribed methodology for ascertaining the quantum of benefits obtained and passed on, it is very difficult for them to accurately ascertain the same.”

In some cases, it is also seen that the companies are holding payments in lieu of these certificates which have made these certifications a bigger matter. Many of industry researchers stated that the public sector companies are the once which are demanding the certificates including port authorities, state electricity boards and companies such as ONGC.

A senior person from taxes department of a company said that “Many public sector companies are asking their vendors to provide a certificate from a reputed CA stating that the benefits of GST are passed on. On the other hand, private sector companies are reaching out to vendors and asking them to pass on additional tax benefits accrued to the vendors due to GST and in many situations, re-negotiations are carried out around pricing.”

The government is under research to find out whether the industries like telecom, banks and insurance companies are giving away the benefits made by the implementation of GST. Although the government has increased the ITC benefits for these companies to see any further changes done in these sectors. Many of the countries which have introduced GST seen inflation which directs the Indian government to watch out for any possible side effects of the implementation.

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