GST panel recommends no extra tax incentives for digital transactions

The Economic Times By ET Bureau Jul 08, 2018, 11.12 PM IST

Another ministerial panel under Modi, on Reverse Charge Mechanism has decided to recommend powers to the GST Council to notify the registered persons who would come under RCM purview.

A ministerial panel tasked by the Goods and Services Tax Council has decided against offering addition tax incentives for digital transactions for a year, citing revenue considerations.

The panel headed by Bihar deputy chief minister and finance minister Sushil Kumar Modi will recommend to the Council, the apex decision making body, to defer any concessions for a year, Modi told reporters on Sunday.

“The Group of Ministers (GoM) will be recommending to the Council that it may think about the proposal of incentivising digital transaction again after a year. The GoM is recommending deferring the proposal for a year,” Modi said.

Another ministerial panel also chaired by Modi on Reverse Charge Mechanism has decided to recommend to the GST Council to notify the registered persons who would come under its purview. The recommendations of these ministerial panels would be placed before the GST Council at its next meeting on July 21.

Modi said the GoM on digital transaction has decided that this is not an opportune moment to incentivise digital payments as it will have revenue implication.

“Let returns and GST revenues stabilise, then we can think about incentivising digital transaction,” he said.

The GST Council in its last meeting in May had discussed offering a 2% concession in GST rate (where the tax rate is 3% or more) to consumers making payment through cheque or digital mode. The discount is proposed to be capped at .`100 per transaction.

The five-member GoM on incentivising digital transaction include Gujarat deputy chief minister Nitinbhai Patel, West Bengal finance minister Amit Mitra, Haryana excise and taxation minister Capt Abhimanyu and Punjab finance minister Manpreet Singh Badal.

On reverse charge mechanism (RCM), Modi said the GoM will recommend that the GST Council decide on the class of registered persons who would be required to deposit taxes on reverse charge basis.

“We have recommended omitting the present Section 9(4) and introducing a new Section 9(4) which will permit the government, on the recommendations of the GST Council, to notify specific class of registered persons who would be covered under RCM provision,” Modi said.

The conditions and the date for levying of RCM would be decided by the council, he added. Under the RCM in GST law, registered dealers are required to make tax payments in case they procure goods from unregistered businesses.

At present, RCM has been deferred till September 30. Badal and Kerala finance minister Thomas Issac, among others are a part of the GoM on RCM, which was constituted in March by the GST Council.

About UsAbout Us

Incorporated in year 2000, our journey began and progressed with providing Software Solutions for ‘e’ Compliances Read More...

Contact UsContact Us

Office- 110-114, 1st Floor Rattan Jyoti
Building 18, Rajendra Place, New Delhi-110008

(011) 45054050
We feel happy to talk

contact@webtel.in / contact@gstinindia.in
Write Your Message

Copyright 2016 © gstinindia.in | All Rights Reserved

E-Way Bill Automation
in Tally.
Click Here
×
E-Way Bill Automation
in Tally.
Click Here
×