Govt notifies GST Council

The Centre has formally notified the Goods and Services Tax (GST) Council, which will decide on the tax rate, exempted goods and the threshold under the new taxation regime.

The council will be chaired by the Union Finance Minister and have Minister in charge of Finance or Taxation or any other Minister nominated by each State Government as its member. Also Minister of State in charge of Revenue or Finance at the Centre would be a member.

"In exercise of the powers conferred by article 279A of the Constitution, the President hereby constitutes the GSTCouncil...," said a government notification.

Earlier this week, the Union Cabinet had approved setting up of the Council, which is expected to thrash out a decision on all major aspects of GST roll out by November 22.

The first meeting of the GST Council will be held on September 22-23.

The government is planning to introduce GST legislations — Central GST and Integrated GST — in Winter Session of Parliament in November. The legislation would mention the tax rate, exempted goods and also the threshold.

Prime Minister Narendra Modi too has directed all officers to ensure that steps are taken to stick to the April 2017 roll out date.

In his meeting with top revenue department officials on Thursday, Modi said the GST Council would need to have intensive meetings to be able to make timely recommendations relating to its mandate, including proposals relating to Model GST laws, GST rates, goods and services that may be subjected to or exempted from GST.

The Constitution (122nd Amendment) Bill, 2016, for introduction of GST in the country was accorded assent by the President on September 8 and the same has been notified as the Constitution (One Hundred and First Amendment) Act, 2016.

According to the Article 279A (1) of the amended Constitution, the GST Council has to be constituted by the President within 60 days of the commencement of Article 279A. The notification for bringing into force Article 279A with effect from September 12, 2016 was issued on September 10, 2016.

The government is keen to implement the biggest tax reform since Independence from April 1,2017, so as to ensure a smooth rollover to the changed tax structure from the beginning of the new financial year and avoid mid-year alterations

Source : http://www.business-standard.com/article/pti-stories/govt-notifies-gst-council-116091600413_1.html

Implication of GST on Vat dealer_2

Input Tax Credit

Under the present sales tax system, a dealer is allowed to claim the tax credit of local goods purchases subject to certain conditions. He is not allowed to take the credit of sales tax on inter-state purchases and other taxes like excise duty, and service tax.

Under GST, input tax credit will be allowed for taxes in the nature of service tax, excise duty and inter- state tax as all these taxes will be subsumed in GST and one tax will be payable on all the sales. 

Further under GST, he will be allowed credit only for goods/services used for purpose of business, if goods/services used partly for the purpose of business and partly for other purposes, amount of credit shall be restricted to so much of the input tax as is attributable to the purposes of his business.

   

For claiming the input tax credit,he must have the following -

(a) Original tax invoice, debit note, supplementary invoice or such other taxpaying document issued  

by a registered supplier

(b) Has received the goods/services;

(c) Tax charged in respect of supply has been paid to appropriate authority

(d) Return has been furnished

(e) Where the goods are received in lots or installments against an invoice, he shall be entitled to the

Input tax credit upon receipt of the last lot or installment.

 Further, input tax credit of CGST (Central Goods and Service tax) can be utilized for making payment of CGST and like this input tax credit of SGST can be utilized to make payment of SGST. Input tax credit of SGST cannot be utilize to make payment of CGST and vice-versa.

                                                       

                                          

Accounts and other records under GST

1.      Following records to be maintained -

·         Inward or outward supply of goods/services

·         Stock of goods

·         Input tax credit availed

·         Output tax payable and paid

·         Such other particulars

2.      These records need to be maintained physically and can also be maintained in electronic form.

3.      Books of accounts and other records shall be retained for the period of 60 months from the last date of filing of Annual Return for the year pertaining to such accounts and records.

4.      Wherethe turnover during a financial year exceeds the prescribed limit,he will get his accounts audited by a chartered accountant or a cost accountant and shall submit to proper officer a copy of audited statement of accounts, reconciliation statement and other documents.

Implication of GST on Vat Dealer _1

Mr. A, An electronic goods dealer is registered under VAT in the state of Delhi. He is making intra- state sale as well as inter- state sale.After the introduction of GST, what are the implications on him are discussed in this article.

Registration

He shall be issued a Certificate of Registration on a provisional basis on the appointed day.Provisional certificate of registration shall be valid for a period of 6 months from the date of issue.He is also required to furnish specified information in the prescribed time period.After furnishing of above information, Certificate of registration shall be granted on a final basis by Central/State Government.

If such person fails to furnish the prescribed information within the time specified, his provisional registration certificate may be cancelled.Provisional registration certificate shall be deemed to have not been issued if the said registration is cancelled in pursuance of an application filed by such person that he was not liable to registration under provision of GST.

Return

The dealershall furnish electronically,the details of outward supplies of goods effected, during a tax period on or before 10^th day of the month succeeding the said tax period.

The dealer shall also furnish, electronically, the details of inward supplies of taxable goods/services, inward supplies of services which is covered under reverse charge and credit or debit notes received in respect of such supplies during a tax period on or before 15^th day of the month succeeding the tax period.

He shall, furnish a monthly return , electronically , the detail of inward and outward supplies of goods/services, input tax credit availed, tax payable, tax paid and other particulars within 20^th days after the end of such month.

If valid return for any previous tax period has not been furnished by him ,he shall not be allowed to furnish return for a tax period.

Registered Dealer shall pay the tax due as per return to the credit of the appropriate Governmentnot later than the last date on which he is required to furnish such return.

Any omission or incorrect particulars discovered, after furnishing a return, shall rectify in the return to be filed for the month, during which such omission or incorrect particulars are noticed, subject to payment of specified interest as applicable.

If the goods has been returned within 6 Months then no tax shall be payable but tax shall be payable by taxable person returning the goods if the said goods are liable to tax under this Act and are returned after a period of 6 months from the appointed day. Further, the seller is entitled to take credit of the tax if he receives goods within a period of 6 months.

Conclusion

After the implementation of GST, a dealer may face new challenges in the areas like IT system integration, working capital, training and education but over a time such issues will be taken care and over a couple of years , he will realize the full potential and benefits of GST.

Important Links for GST

http://www.cbec.gov.in/htdocs-cbec/gst

http://www.idtc.icai.org/

https://gst.taxmann.com/