01/07/2017 TO 01/07/2019: Journey of GST
GST is a very vast Indirect Taxation regime implemented in India on 1st of July 2017 and has now completed 2 years. GST had 17 existing indirect taxes including the excise duty and sales tax.and tried to bring in consistency and avoid the cascading effects.
In December last year, former Union Finance Minister Arun Jaitley said 97.5 per cent articles covered by 18 per cent or lower GST slab. Under the previous, value-added tax (VAT) regime, standard taxation rate was much higher. Standard VAT rate was 14.5 per cent and excise duty was 12.5 per cent. This was to be topped up by sales tax and cess. In many cases the overall tax rate crossed 31 per cent.
In the 2 years, around 35 GST council meetings were held to improve the law, reduce the compliances and help the registered tax payers. GST Amendment Act, 2018 was also introduce to reduce the loopholes of law. Still, the International Monetary Fund (IMF) had last year advised the Government to simplify GST to smoothen the processes of business and finance.
In the pre-GST period, traders had to comply with the rules and regulations of various tax departments and laws. Now, tax compliance has been easier for traders. This has augured well for the government as the revenue base has expanded exponentially.
The assessee base under GST has increased by about 85 per cent in the past two years. On the eve of the GST rollout, the assessee number stood at around 65 lakh, which has gone up to 1.20 crore now.
The government’s revenue collection has also gone up. The average revenue collection per month in the eight months of 2017-18 was Rs 89,700 crore per month. This propelled the annual revenue collection by about 12 per cent.
The monthly average revenue collection increased further in 2018-19 by about 10 per cent to Rs 97,100 crore. But despite this accomplishment, the revenue collection missed the target that the government had set for the GST for both the years since its rollout.
As of now, GST is levied on every product except petroleum, alcohol, tobacco and stamp duty on real estate in four slabs of 5, 12, 18 and 28 per cent. Most of the daily use articles have zero GST as per the latest revision of the tax rates last year. Exports are zero rated supply in GST. Refund is available in case of zero rated supply or inverted duty structures as per the respective rules.
When we talk about compliances, a registered person having turnover more than 1.5 Cr has to file:
- 12 GSTR 1
- 12 GSTR 3B
- 1 Annual return (GSTR 9)
- 1 Audit Reconciliation (GSTR 9C) in case turnover is more than 2 Cr.
In case person is required to collect TCS (E- comm operator) GSTR 8 is required to be filed monthly. GSTR 7 in case of TDS.
In case of cancellation of registration Final Return needs to be filed.
It all means there are number of compliances which is making GST complicated. Although remeber the sections of mismatching is not yet made applicable!!
