HERALD: How is GST beneficial for the honest taxpayer?
K ANPAZHAKAN: Input tax credit (ITC) is the crux of GST regime where an honest tax payer can avail ITC credit if he is honestly paying all taxes, filing returns on time and passing eligible credit to his buyer. GST regime has a concept of GST compliance rating where a tax payer will be rated, based on their compliance performance. Definitely honest tax payer will have higher ratings and will naturally get more business because their buyer will have more faith on such business houses which has higher GST compliance rating as they will pass eligible tax credit on time to buyer.
HERALD: How will GST impact tax-evaders?
KA: Key things to prevent tax evasion are Input Tax Credit (ITC), a massive IT backbone called GSTN which will be used to detect evasion even without intrusion. The government gets each B2B transaction registered through its portal – GSTN and provides incentive for the all players across the value supply chain to follow the rules for claiming ITC. Due to concept of invoice matching, it is easy for department to check the evasion where ever government finds ambiguously breaking of ITC chain. Secondly, as the ITC claim of the buyer depends on passage of ITC by supplier. It makes buyer to force supplier to pay taxes and file return on time so that he can claim the credit. It is a kind of self-policing character. In this regime, it would be difficult for tax evaders to do business as every player in supply chain wants to avail the benefit of ITC which could be possible if tax payer is honest.
HERALD: Does a taxpayer need to be tech savvy for GST compliance?
KA: This is a myth spread across the country that tax payer needs to be Tech savvy for GST compliance. First, there is no mandatory provision to have computer generated invoice. One can issue manual invoice. For filing returns, the interface is so easy that one can file return using mobile phones. There are also GST Seva kendras in all GST departments to facilitate filing of returns. A person who is computer illiterate can utilise the facility of these kendras without any fees. Also pre GST regime, the small traders and manufacturers were filing VAT and excise returns online on monthly or quarterly basis. Hence, there is nothing new or extra compliance burden been put on taxpayer.
HERALD: How many returns does a taxpayer need to file?
KA: There is a wide spread myth across the country that one has to file 37 returns which will increase the compliance cost of the trade. GST regime is very simple for filing of returns. A taxpayer has to file most important return GSTR1 for outward supplies only every month. GSTR2 which is inward supplies return is auto-populated one. Tax payer just needs to accept the entries in that return. GSTR 3 is auto populated after finalisation of GSTR1 and GSTR2. So, if u see just one return every month needs to be filed, rest are auto-populated. Hence, it will not increase any compliance cost.
HERALD: How has GST regime given relief to small taxpayers?
KA: GST regime is far better than previous VAT and excise regime. The threshold limit under VAT regime was Rs 5 lakh and for Service Tax it was Rs 10 lakh. Whereas threshold limit in GST regime is Rs 20 lakh which is much higher. Higher threshold has given lot of relief to small traders and service providers.
For threshold upto Rs 75 lakh, there is composition scheme for small traders, manufacturers (except few) and restaurants. Some argue that for manufacturer, central excise threshold limit was Rs 1.5 crore which has been reduced to Rs 75 lakh but one must understand that all those manufacturers were already under VAT regime you must be aware that in GST regime, there will be single interface of administration, hence no extra compliance burden has been imposed on those manufacturers.
HERALD: What is the Composition Scheme and how bill of supply is different from taxable invoice? How does a consumer know whether one is a composition dealer or not?
KA: Under composition scheme small traders, manufacturers are liable to pay 1%, 2% and 5% GST respectively. However, there are certain conditions attached to it that they cannot avail ITC on inward supplies and cannot do inter-state outward supplies. They are also not allowed to issue taxable invoice instead they can raise bill of supply. If any consumers buying goods whether it is at restaurants too from supplier under this scheme, one can find the display board in establishment, where supplier must declare “Composition Taxable Person” at prominent places and also print on bill of supply with “composition taxable person, not eligible to collect tax on supplies”.
HERALD: How is Government hand-holding the taxpayer?
KA: Our officers are trying to clarify lot of doubts and also seeking feedback from trade and industry to seek further clarification from board. We have e-helpline email ID – gstsevakendragoa@ gmail.com and twitter handle of Goa GST – @GST_Goa where one can post the query.
