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♦ New GST return mechanism will be implemented in phases
♦ GST Council may fix Rs 50 crore turnover threshold for e-invoice under GST
♦ Central Boards of Indirect taxes & Customs extends due date of FORM GSTR-9, GSTR-9A & GSTR 9C
♦ GST exemption on goods supply by retail outlet established in departure area of international airport
The Finance Ministry on Tuesday unveiled a roadmap for the implementation of the new GST return mechanism. It has also put in place a transition mechanism.
The new mechanism will be used on a trial basis from July to September. For the large taxpayers (those whose aggregate annual turnover in the previous fiscal was more than 5 crore), Form GST ANX will replace GSTR 1 from October. Small taxpayers (with aggregate annual turnover in the previous fiscal up to 5 crore) who file on a quarterly basis will have to use this in January for the October-December quarter.
Form GST RET-1 will replace GSTR-3B; it will be mandatory from January for all taxpayers.
The government has released the draft of a new and simplified return form with offline tools. There are three main components to the new return process — the main return form (Form GST RET-1) and two annexures (Form GST ANX-1 and Form GST ANX-2).
From July, users will be able to upload invoices using the GST ANX-1 offline tool on a trial basis. They will also be able to view and download the inward supply invoices using the GST ANX-2 offline tool under the trial. The summary of inward supply invoices will also be available for view on the common online portal.
Additionally, from August, users can import their purchase register in the offline tool and match it with the downloaded inward supply invoices to spot mismatches.
The July-September trial is for taxpayers to familiarise themselves with the new return mechanism. It will have no impact at the back end on the tax liability or input tax credit of the taxpayer. In this period, taxpayers will continue to file existing return forms (GSTR-1 and GSTR-3B); failure to do will attract penalties.
From October, GST ANX-1 will be compulsory, replacing GSTR-1. The large taxpayers will upload their monthly GST ANX-1 from October. However, the first compulsory quarterly GST ANX-1 to be uploaded by small taxpayers will be due only in January 2020, for the October-December 2019 quarter.
Invoices can be uploaded in GST ANX-1 on a continuous basis, both by large and small taxpayers, from October. GST ANX-2 may be viewed simultaneously during this period but no action will be allowed on it.
For October and November, large taxpayers will continue to file GSTR-3B on a monthly basis. They will file their first GST RET-01 for December by January 20, 2020. Small taxpayers will stop filing GSTR-3B and start filing GST PMT-08 from October. They will file their first GST RET-01 for the quarter October-December from January 20 next year.
The finance ministry is likely to propose Rs 50 crore as the turnover threshold for entities to generate e-invoice on a centralised government portal for business-to-business (B2B) sales as it looks to curb GST evasion, an official said.
The GST Council, which will meet on June 20, will take a final decision on the turnover threshold for issuance of e-invoice for B2B sales after consultation with states.
Analysis of return filing shows that as many as 68,041 businesses have reported a turnover of over Rs 50 crore and accounted for 66.6 percent of total GST paid in 2017-18.
Further, while these businesses account for just 1.02 percent of GST payers, they make up almost 30 percent of the B2B invoices generated in the system.
“The turnover threshold for entities to generate e-invoice for B2B sales is likely to be fixed at Rs 50 crore if the GST Council agrees. With this threshold, big taxpayers who are better placed technologically to integrate their software would have to generate e-invoice for B2B sales,” the official told PTI.
With e-invoice generation, entities with turnover above Rs 50 crore would be saved from the twin activities of filing returns and uploading invoices. From the government’s side, this would help in curbing invoice misuse and tax evasion.
The official further said that under the current system, there is a gap between the time of generation invoices and filing of sales returns.
The number of entities filing monthly summary sales return GSTR-3B and paying GST is higher than those filing outward supply return GSTR-1, in which invoice-wise details have to be filed. Analysis suggests the gap could be either because of genuine difficulty in uploading invoices or with the intention of misusing Input Tax Credit (ITC), the official said.
The ministry is planning to roll out the e-invoice system by September.
The official further said that data analysis shows that as many as 3.9 crore B2B invoices worth above Rs 50,000 are generated every month, which works out to be 12 lakh per day.
The number increases to about 1 crore per day if all B2B invoices generated irrespective of amount are taken into account.
The official said 1 crore invoice generation per day can be handled by GSTN/NIC as this would be similar to the number of e-way bills currently being generated on the portal.
The ministry feels that e-invoice would increase ease of doing business if it becomes part of using business process and there is no need for additional reporting, the official said.
GST Council decision relating to changes in law and procedure
The GST Council, in its 35th meeting held today at New Delhi, recommended the following:
1. In order to give ample opportunity to taxpayers as well as the system to adapt, the new return system to be introduced in a phased manner, as described below:
i Between July, 2019 to September, 2019, the new return system (FORM GST ANX-1 & FORM GST ANX-2 only) to be available for trial for taxpayers. Taxpayers to continue to file FORM GSTR-1 & FORM GSTR-3B as at present;
ii. From October, 2019 onwards, FORM GST ANX-1 to be made compulsory. [arge taxpayers (having aggregate turnover of more than Rs. 5 crores in previous year) to file FORM GST ANX-1 on monthly basis whereas small taxpayers to file first FORM GST ANX-1 for the quarter October, 2019 to December, 2019 in January, 2020;
iii. For October and November, 2019, large taxpayers to continue to file FORM GSTR-3B on monthly basis and will file first FORM GST RET-01 for December, 2019 in January, 2020. It may be noted that invoices etc. can be uploaded in FORM GST ANX-1 on a continuous basis both by large and small taxpayers from October, 2019 onwards. FORM GST ANX-2 may be viewed simultaneously during this period but no action shall be allowed on such FORM GST ANX-2;
iv. From October, 2019, small taxpayers to stop filing FORM GSTR-3B and to start filing FORM GST PMT-08. They will file their first FORM GST¬RET-01 for the quarter October, 2019 to December, 2019 in January, 2020;
v. From January, 2020 onwards, FORM GSTR-3B to be completely phased out
2. On account of difficulties being faced by taxpayers in furnishing the annual returns in FORM GSTR-9, FORM GSTR-9A and reconciliation statement in FORM GSTR-9C, the due date for furnishing these returns/reconciliation statements to be extended till 31.08.2019
3. To provide sufficient time to the trade and industry to furnish the declaration in FORM GST ITC-04, relating to job work, the due date for furnishing the said form for the period July, 2017 to June, 2019 to be extended till 3 1.08.2019
4. Certain amendments to be carried out in the GST laws to implement the decisions of the GST Council taken in earlier meetings
5. Rule 138E of the CGST rules, pertaining to blocking of e-way bills on non-filing of returns for two consecutive tax periods, to be brought into effect from 21.08.2019, instead of the earlier notified date of 21.06.2019
6. Last date for filing of intimation, in FORM GST CMP-02, for availing the option of payment of tax under notification No. 2/2019-Central Tax (Rate) dated 07.03.2019, to be extended from 30.04.2019 to 31.07.2019
Central Boards of Indirect taxes & Customs exempts any supply of goods by a retail outlet established in the departure area of an international airport, beyond the immigration counters, to an outgoing international tourist vide Notification No. 11/2019-Integrated Tax (Rate) dated 29th June, 2019
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
G.S.R. 462(E). -In exercise of the powers conferred by sub-section (1) of section 6 of the Integrated Goods and Services Tax Act, 2017 (13 of 2017), the Central Government, on being satisfied that it is necessary in the public interest so to do, and on the recommendations of the Council, hereby exempts any supply of goods by a retail outlet established in the departure area of an international airport, beyond the immigration counters, to an outgoing international tourist, from the whole of the integrated tax leviable thereon under section 5 of the Integrated Goods and Services Tax Act, 2017.
Explanation. – For the purposes of this notification, the expression “outgoing international tourist” shall mean a person not normally resident in India, who enters India for a stay of not more than six months for legitimate non-immigrant purposes. The notification shall come into force with effect from the 1st day of July, 2019.
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