A ministerial panel chaired by Bihar deputy chief minister Sushil Modi has worked out a new simplified model for goods and services tax (GST) return filing as per which input tax credit could be given on a provisional basis once the supplier uploads the sales invoice. However, the current system of filing the interim return GSTR-3B while paying the tax might continue till a new single-page return is endorsed by the GST Council. The GSTR-3B was to replaced with more comprehensive returns with details
of inward and outward supplies post-June. The idea was to have system of invoice-matching without complexities. The group of ministers (GoM) on Tuesday met about 40 industry representatives and 15 tax tax experts to discuss simplification of the return filing process.
Meanwhile, six more states — Bihar, Haryana, Jharkhand, Madhya Pradesh, Tripura and Uttarakhand — will launch the electronic way bill mechanism for intrastate movement of goods above a threshold value from April 20. This means that including the five states that had launched the system on Sunday (Andhra Pradesh, Gujarat, Kerala, Telangana and Uttar Pradesh) and Karnataka which had it running even earlier, 12 states will have the anti-evasion measure rolled out by April 20. The e-way bill system, which allows tracking of consignments with a value above Rs 50,000 beyond 10 km, was rolled out for interstate transport on April 1.
While bulk of the GST assessee base of over 1 crore are yet to register for the e-way bill, the implementation of the system has been rather smooth so far. As many as 10.31 lakh e-way bills were generated on the portal on Monday, out of which 2.60 lakh were at the intrastate level. The e-way bill system is expected to plug revenue leakages of `10,000 crore in business-to-consumer transactions. After the crash in February, the GST Network system was augmented to generate 75 lakh e-way bill a day. Nine states have generated 82% of the total e-way bills so far. Gujarat topped the list of states for intrastate e-way bill generation, followed by Karnataka and Maharashtra.
An earlier model of return filing proposed that input tax credit could be availed simply by uploading of invoices by the seller and subsequent confirmation by the recipient. Based on acceptance by the recipient, the credit could be finalised. Another model was simultaneous uploading of sales/purchase data wherein the buyer would be able to avail credit on filing of purchase details at the invoice level; the taxpayer had to match only data under the mismatch category. As against these, what is being planned now is a third fusion model, under which credit could be extended once the invoice uploaded by the supplier is verified by the purchaser on the GSTN portal. Also, system-based notices may be issued to taxpayers for non-payment of taxes even after availing credit and the credit could be reversed.
“It’s good to see wider consultation with industry bodies and experts on the returns simplification process. Clearly, the government wants to implement the revised system after adequate due diligence this time. However, this process may take some time with possible changes in laws. It seems the new GST returns may only be introduced either in the last quarter or the next year,” said Pratik Jain, leader, indirect tax, PwC. Modi said there was unanimity in the GoM that businesses would have to file only one return every month, instead of GSTR-1, 2 and 3 as was conceived earlier.
Also there was unanimity that there would be no system-based matching and the purchaser would have to verify the invoice uploaded by the seller. Modi said the model for simplified return filing that is being worked out would safeguard the interest of revenue to the exchequer, and avoid inconvenience to taxpayers. “Till then, it’s likely that the current summary return (GSTR 3B) on a monthly basis will continue,” said Jain.