sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Latest Expert Exchange
« GST - Goods and Services Tax »
 30 LPA-Opening Chief Financial Officer
 30 LPA-Opening Director-risk Assurance
 GST Council could cut tax rates on these items in next meeting
 Frequent changes in GST may muddle the tax system
 Financial services firms fear GST may hit returns
 GoM expected to finalise views on reverse charge under GST, to meet on July 8
 Sales recover but retailers seek ease of tax filing One year of GST
 One year of GST: 5 changes which common man would like to see in GST
 Single tax return form under GST may come in by December
 10 Things That Shaped The New Tax
 Income tax June 27 GST turnover mandatory to file I-T return

Nothing alarming about massive transitional GST credit claim, says finance ministry
September, 20th 2017

Finance ministry concludes that GST credit claims were for credit that firms had accumulated over a period of time and they would not be in a position to utilize it in one go

The massive Rs65,000 crore tax credit claimed by businesses in July while shifting to the goods and services tax (GST) regime is not a cause for worry as it will only be utilized by firms over many months, finance ministry officials said.

The ministry, which looked into the tax credit claims which accounted for two-thirds of the GST collection in the first month of the tax reform, has concluded that the claims were for credit that companies had accumulated over a period of time and they would not be in a position to utilize it in one go.

“Credit for excise duty paid in the earlier regime can only be claimed against central GST (CGST). The accumulated credit is much more than what can be claimed on manufacturing output in one month. There is nothing to be alarmed about,” said a finance ministry official, seeking anonymity.

The ministry had asked taxpayers to calculate their July tax liability after adjusting for tax credits that they wanted to utilize for the month. Experts said the GST receipts of Rs95,000 crore collected by Union and state governments for July may go further up as nearly a third of registered GST payers are yet to file returns and pay taxes.

“To ensure seamless GST credit, businesses registered for GST are asking unregistered vendors to register for GST. This acts as a self policing system and should result in a significant expansion of the tax base,” said Abhishek Jain, partner, indirect taxes, EY. The remaining assessees filing tax returns and paying taxes will also add to the tax revenue, added Jain.

The government is also working on a scheme to enable small traders with annual sales of less than Rs20 lakh—the threshold for GST registration—to register for GST under a simpler voluntary compliance system.

Central Board of Excise and Customs (CBEC), the indirect tax administration of the Union government, has already ordered audit of tax credit claims above Rs1 crore. CBEC had asked field officers to verify the large claims by 20 September, Mint reported on 15 September.

Experts said that unlike the earlier excise and service tax system, GST enables electronic matching of the taxes paid by a material supplier and the tax credit claimed by the buyer, which eliminates chances of fraud and tax evasion. As per this, tax credits claimed by a business will be honoured only if a raw material supplier, who has issued a tax paid invoice, has actually remitted the tax amount to the government.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
SEO Company Search Engine Optimization Company US SEO Local SEO Company Website SEO Company Alabama SEO Company Alaska SEO Company Arizona SEO Company Arkansas SEO Company California SEO Company Colorado SEO Company Connecticut SEO Company Delawa

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions