Was reading the proposals of Nandan Nilekani & Committee set by GST Council regarding simplification of GST returns
Actually this study should have done by the govt before June 2017. Since we don't have proactive thinking and just passing our days with Trial and Error method of administration (like many corporates do) the govt initiated this study only after a huge mess created by this immatured GSTN procedures.
So coming to the proposals
Both talks about GSTR3B with an annexure of Invoices (GSTR1) to be uploaded by the seller. This is OK, as it is being followed by existing VAT regime also
From buyer point of view, to avail ITC the two proposals gives two methods.
Nilekani proposes, if the buyer find his purchase bill uploaded by the seller, he can accept it and take credit. If not found he can insist seller to upload. In anycase , unless the seller uploads, buyer can't get ITC.
In this method, the Working capital of the buyer goes for a toss. If the seller not uploaded his bills, the buyer can't take credit. Even though he received the material and bill, he need to pay CASH till seller uploads the bill. Once uploaded he can avail ITC and it sits in the Credit ledger. Credit can be claimed as refund. Hope you are all aware how the refund system 'working' now on GST
Second proposal was by the committee. It suggests buyer to avail ITC even though the seller not uploaded the bill. It is similar to the present system of GSTR2. But the ITC will be valid only of buyer adds the bill and seller accepts it.
It is so tedious job. If a company has around 2000 bills per month for purchase, they have to reconcile every bill and add missing bill to take ITC after it was accepted by the buyer. If not, he has to pay CASH and go for refund.
Both the proposals are useless in my view. It increases the burden and won't give any accuracy of Cashflow. It spoils the Working capital of businesses and the MSME sector will be finished easily.
My worry or surprise is, doesn't we have a single person out of 132 Cr people (or 125 Cr as per PM, after deducting TN population 😝) who can suggest a simple & useful mechanism for filing GST returns?
Or why can't the govt calls for a discussion with Indirect tax experts, CBIC officials etc., to find a working system for statutory compliance?
What stops them to find a solution to resolve the mess up?
Can someone explain?
Actually this study should have done by the govt before June 2017. Since we don't have proactive thinking and just passing our days with Trial and Error method of administration (like many corporates do) the govt initiated this study only after a huge mess created by this immatured GSTN procedures.
So coming to the proposals
Both talks about GSTR3B with an annexure of Invoices (GSTR1) to be uploaded by the seller. This is OK, as it is being followed by existing VAT regime also
From buyer point of view, to avail ITC the two proposals gives two methods.
Nilekani proposes, if the buyer find his purchase bill uploaded by the seller, he can accept it and take credit. If not found he can insist seller to upload. In anycase , unless the seller uploads, buyer can't get ITC.
In this method, the Working capital of the buyer goes for a toss. If the seller not uploaded his bills, the buyer can't take credit. Even though he received the material and bill, he need to pay CASH till seller uploads the bill. Once uploaded he can avail ITC and it sits in the Credit ledger. Credit can be claimed as refund. Hope you are all aware how the refund system 'working' now on GST
Second proposal was by the committee. It suggests buyer to avail ITC even though the seller not uploaded the bill. It is similar to the present system of GSTR2. But the ITC will be valid only of buyer adds the bill and seller accepts it.
It is so tedious job. If a company has around 2000 bills per month for purchase, they have to reconcile every bill and add missing bill to take ITC after it was accepted by the buyer. If not, he has to pay CASH and go for refund.
Both the proposals are useless in my view. It increases the burden and won't give any accuracy of Cashflow. It spoils the Working capital of businesses and the MSME sector will be finished easily.
My worry or surprise is, doesn't we have a single person out of 132 Cr people (or 125 Cr as per PM, after deducting TN population 😝) who can suggest a simple & useful mechanism for filing GST returns?
Or why can't the govt calls for a discussion with Indirect tax experts, CBIC officials etc., to find a working system for statutory compliance?
What stops them to find a solution to resolve the mess up?
Can someone explain?
ReplyDeleteThank you for post and your blog. My friend showed me your blog and I have been reading it ever since.
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