Page 10 - Banking Finance July 2019

GST UPDATE

Govt to impose GST on GST officers to investigate profiteering
In a bid to strengthen anti-profiteering measures in the nation, Standard Oper-
inter-state office services
ating Procedure (SOP) for Central and State GST officers has
The government is planning to im-
been proposed by the National Anti-profiteering Authority
pose GST
(NAA) to monitor top 20 suppliers in their jurisdictions.
on the
Meanwhile, the officers will be making mock purchases and
services
take other measures.
provided
by an of- A complaint can be filed by an interested party or a commissioner or any other
fice of an person, underscores the Rule 128 of the CGST Rules 2017. A commissioner is
organisation in one state to another considered to be the most competent authority to find whether a rate reduc-
office in another state. In regard to tion has been passed on or not. The commissioner can also authorise any officer
that, a circular endorsed by the GST to file an anti-profiteering case. As of now, it is mostly the consumers who file
Council, will be issued soon, in- complaints.
formed a government official.
At the central level, the CBIC (Central Board of Indirect Taxes & Custom) can
The measure is in line with the view issue instructions to its officials. Once approved by the GST Council, the states’
taken by Karnataka Authority for Ad- tax administration can issue instructions to GST officials.
vance Rulings (AAR) that the in-house
As per the draft SOP placed before the GST Council, all CGST and SGST commis-
functions such as human resources
sioners will identify top 20 suppliers under their jurisdiction in respect of which
and payrolls, if carried out from a
the prices/MRP and availability of Input Tax credit (ITC) are likely to be impacted
centre in one state for offices in
by changes in tax rate or any additional ITC benefit.
other states, will face GST, and for
The commissioners will collect the data from such suppliers and will collect pre-
which invoice will have to be issued.
rate-reduction evidences, such as invoices, which could help them establish the
The official further stated that the
facts of the case. For the purpose of that an anti-profiteering cell will be desir-
circular will underscore emoluments
able which will not just assist in data collection but also in creating awareness.
offered to service personnel will have
to be included under this. However, The commissioners may also ‘cause purchase of any goods or service affected
input tax credit for this can be by a rate change.’ The CGST Act 2017 underscores authorisation for the com-
claimed by the companies, but for missioners to make mock purchases for collecting invoice for the evidence. The
certain sectors such as power, GST Council has also approved two-year extension for NAA, making it functional
healthcare, liquor, and education, it till November 30, 2021.
will become a cost since credit of tax
charged would not be available. Govt extends last date of annual tax returns filing un-
The law committee under the GST der GST
Council has sought to clarify the issues
The tenure of the national anti-profiteering authority (NAA) has been extended
dealing with distribution of input tax
by the 35th GST council till November 30, 2021. The council has also extended
credit in respect of input services pro-
the date for filing annual returns under the GST regime August 31. The one-
vided by the head office through the
form new GST returns filing system will be applicable from January 1, 2020. The
circular, but attributable to head of-
meeting was chaired by Finance Minister Nirmala Sitharaman.
fice or various branch offices, treat-
ment of expenses incurred by the At the backdrop of the concerns of businesses evading GST returns the council
head office on the procurement, dis- has taken the move. A decline in GST collections had shed light on the specula-
tribution and management of com- tions regarding businesses avoiding the tax net. Several complaints by consum-
mon input services, treatment of ser- ers against companies for not passing on GST rate cut benefits have also been
vices provided by head office such as came into light.
common administration or common
In addition of extending the tenure of NAA, the council also has given the ap-
IT maintenance to its branch officers
proval of imposing a penalty of up to 10% on entities for not passing on benefits
and their valuation.
of GST rate cuts to consumers.

10 | 2019 | JULY | BANKING FINANCE