Page 11 - Banking Finance April 2020

GST UPDATE

GST

NEWS
NEWS
NEWS
NEWS
NEWS

Mobile handset manufac- total tax incidence would come down (GST) revenue in February, a tad lower
after the implementation of GST, the than the Rs. 1.1 trillion mopped up in the
turers seek urgent rollback ICEA said in the letter. This, however, previous month, official data showed.

of increase in GST rate was increased to 12% in July 2017. Collections in February represents an
Manufacturing companies of mobile 8.3% growth over receipts in the same
handsets have said that the recent “GST was introduced with the principle time a year ago.
50% increase in GST rate was of revenue neutrality and by the
‘erroneously’ based on the premise assertion that total tax incidence will This is the fourth consecutive month of
that pre-GST excise duty rate was in fact come down after introduction GST receipts remaining above the Rs. 1
12.5%, when it was just 2%. of GST,” ICEA chairman Pankaj trillion mark this financial year after
Mohindroo has said in the four-page collections had shown a contraction in
They sought an urgent roll back of the letter to Sitharaman. October and November from the
increase, saying it would “devastate” comparable period a year ago. The
the sector already reeling from the Govt extends date in GST improvement in GST receipts comes in
impact of the Covid-19 outbreak, lead Return filing, made the wake of efforts by Central and state
to huge job losses and a strong return relaxation in late fee, government officials to step up
of the grey market. compliance.
penalties
The India Cellular & Electronics In a bid to give relief to the businesses An official statement from the finance
Association (ICEA) said in a letter to amid the Covid-19 outbreak, the ministry said that 8.3 million monthly
Nirmala Sitharaman that the increase government has announced extension of summary GST returns have been filed
in the GST rate to 18% effective April the filing of Return for the month of for the month of January, upto 29
1 from 12% would “draw out Rs 15,000 March, April and May 2020 and February. Tax collections in February
crore from the ecosystem and composition returns under GST June 30. refers to transactions in January.
devastate the retail sector already This date has been further extended
under attack from Covid-19”. ICEA due to extention of Lockdown. The improvement in GST collections is
further stated that it would further likely to offer some comfort to the
federal indirect tax body, the GST
impact 80 crore consumers at a time
when their spending capacity could GST collections move up Council, which is expected to meet
come under pressure. 8.3% to Rs. 1.05 TRN in later this month. Steps to improve
revenue receipts and addressing the
Before the implementation of GST, the Feb anomalies in the tax structure are
composite VAT was between 6% and 7% Central and state governments collected among the issues that are likely to be
and the mobile industry expected the Rs. 1.05 trillion in Goods and Services Tax taken up by the Council.

BANKING FINANCE | APRIL | 2020 | 9