Proposed Amendments in GST in Union Budget 2021.


Proposed amendments in the CGST Act, 2017

1.Supply:

Sec. 7(1)(aa): To be inserted  to ensure levy of tax on activities or transactions involving the supply of goods or services by club and associations (non individuals), to its members or constituents or vice-versa, retrospectively, with effect from the 1st July, 2017.

2. Input tax credit:

Section 16(2)(aa): ITC can be availed only when the details of such invoice or debit note have been furnished by the supplier in the statement of outward supplies and such details have been communicated  (GSTR 2A/IFF) to the recipient of such invoice or debit note.

3 Annual Return and GST Audit:

Section 35(5): To be omitted so as to remove the mandatory requirement of getting annual accounts audited and reconciliation statement submitted by specified professional (GSTR 9C).

Section 44: To furnish a reconciliation statement along with the annual return on self-certification basis. It further provides for the Commissioner to exempt a class of taxpayers from the requirement of filing the annual return.

4. Interest:

Section 50: To be amended, retrospectively, to substitute the proviso to sub-section (1) so as to charge interest on net cash liability with effect from the 1st July, 2017.

5. Seizure and confiscation of goods and conveyances in transit:

Section 74: To be amended so as make seizure and confiscation of goods and conveyances in transit a separate proceeding from recovery of tax.

6. Self-assessment tax and recovery:

Section 75: An explanation to sub-section (12) of section 75 of the CGST Act is sought to be inserted to clarify that “self-assessed tax” shall include the tax payable in respect of outward supplies, the details of which have been furnished in GSTR 1, but not included in GSTR 3B.

7. Provisional attachment:

Section 83: To be amended so as to provide that provisional attachment shall remain valid for the entire period starting from the initiation of any proceeding under Chapter XII, Chapter XIV or Chapter XV till the expiry of a period of one year from the date of order made thereunder.

8. Pre-deposit for Appeal filing:

Section 107: A proviso to sub-section (6) of section 107  sought to be inserted to provide that for appeal filed against an order made under sub-section (3) of section 129 (detention and seizure of goods and conveyance during transit), a sum equal to twenty-five per cent. of penalty has to been paid as pre-deposit.

9. Seizure and confiscation of goods and conveyances in transit:

Section 129: To delink the proceedings under that section relating to detention, seizure and release of goods and conveyances in transit, from the proceedings under section 130 relating to confiscation of goods or conveyances and levy of penalty.

Further the quantum of penalty u/s 129 has been doubled to 200% of the tax payable where the owner of the goods comes forward for payment of such penalty

Section 130: Similarly Section 130 of the CGST Act is sought to be amended to delink the proceedings under that section relating to confiscation of goods or conveyances and levy of penalty from the proceedings under section 129 relating to detention, seizure and release of goods and conveyances in transit.

 

Proposed amendments in the IGST Act, 2017:

1. SEZ supplies

Section 16:To be amended so as to zero rate the supply of goods or services to a Special Economic Zone developer or a Special Economic Zone unit only when the said supply is for authorised operations.

2. Refunds on account of zero-rated supplies

Section 16: To be amended so as to restrict the zero-rated supply on payment of integrated tax only to a notified class of taxpayers or notified supplies of goods or services and link the foreign exchange remittance in case of export of goods with refund.


Posted on 03/02/2021
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