GOODS AND SERVICES TAX (GST)

10.04.2019

Three businessmen held for CGST fraud worth Rs 100 crore.

Accused floated seven firms, including 3 shell companies, to generate bogus invoices and avail income tax credit

Three businessmen were arrested by the prevention wing of the Thane Commissionerate’s Central Goods and Services Tax (CGST) for allegedly defrauding the tax body of over Rs 100 crore by illegally availing tax credit with the help of bogus invoices.

The accused allegedly filed fake invoices worth Rs 1,100 crore through shell companies to avail input tax credit (ITC).

Input credit is the tax benefit that manufacturers get for the GST they pay on the purchase of goods. Unscrupulous traders are often known to buy fake bills to claim increased ITC, which automatically leads to an inflated turnover on the basis of which they can then apply for hefty bank loans.

The accused have been identified as Rakesh read more »

02.04.2019

GST collection hits record high in March - Crosses Rs. 1L-Cr Mark On Better Compliance.

New Delhi: GST collection in March crossed the Rs 1-lakhcrore mark, the highest since the tax reform measure was rolled out in July 2017, bringing relief for the government battling sluggish receipts.

Total gross GST collected in March was Rs 1,06,577 crore, of which CGST was Rs 20,353 crore, SGST Rs 27,520 crore, IGST Rs. 50,418 crore (including Rs 23,521 crore collected on imports) and cess was Rs 8,286 crore (including Rs 891crore collected on imports), according to finance ministry data.

The rebound in GST revenues comes against the backdrop of robust receipts on the direct tax front, with tax officials expressing confidence about meeting the 2018-19 target. They said receipts will keep flowing in till middle of the month and a final picture would be available by then.

In an interview to TOI, finance minister Arun Jaitley read more »

19.03.2019

Lower GST for realty from April.

New Delhi: The GST Council on Tuesday decided to allow all projects where construction begins from April to move to a lower levy, but postponed a decision on the Maharashtra government’s demand for classifying apartments that cost under Rs 70 lakh in Mumbai as “affordable housing”.

The decision follows the council’s move to lower GST rates to 1% for under-construction affordable housing projects and 5% for others but withdraw the benefit of credit for taxes paid on inputs such as steel, cement and paints as builders were seen to be pocketing the gains. Currently, builders pay 8% GST on under-construction affordable housing and 12% on other projects. The council decided to give builders of under-construction residential projects the option to choose between the old tax rate and the new rate as part of a transition plan.

‘New regime won’t push read more »

16.03.2019

A TAXABLE SERVICE - Charitable trusts holding marathons to face GST.

New Delhi: In a setback to several charitable institutions, the Tamil Nadu Authority of Advance Ruling (AAR) has held that conducting marathons by a charitable trust registered under the Income Tax Act does not exempt them from GST liability as only activities covered under definition of “charitable activities” under a 2017 notification are exempt.

In response to a reference by Dream Runners Foundation, the AAR found that the entity needed to be registered under the central and state GST laws as it was making taxable supply of services such as organising marathon, while noting that its aggregate turnover in a financial year exceeded the prescribed Rs 20 lakh. The authority said that the money collected from participants was a consideration towards the supply of service of organising and conducting the marathon and was liable to incur GST.

It noted the petitioner’s read more »

12.03.2019

COUNCIL MEET ON MARCH 19 - GST cut: Govt expects realtors to pare prices.

New Delhi: The GST Council, which is scheduled to meet on March 19, may restrict the use of tax credits accumulated by builders and allow a concessional rate for up to 10% of commercial property, such as shops, in residential complexes, expecting developers to pare prices.

At the last meeting, the council — comprising state and Union finance ministers — had agreed to reduce the levy on under-construction residential projects to 5% without input tax credit (ITC) from the current 12%, with credit for taxes paid on inputs such as paints, steel, cement and sanitary ware. For affordable housing projects, the rate will be slashed to 1% without ITC from 8% with tax credit. But the modalities for the rate reduction, which will be effective, are yet to be worked out.

Sources indicated that the officials were in favour of accepting read more »

09.03.2019

GST relief for pharma samples, discount offers - Experts: Businesses Will Face Challenges On Types Of Sale.

New Delhi: Many businesses have been grappling with basic questions on discounts and freebies. Does a free toothbrush with a tube of toothpaste attract GST? Or, how much GST will be levied on a charger that is part of a pack of mobile phone purchased by customers?

Close to two years after GST was launched, the finance ministry sought to provide some answers. So, from now on companies know that the toothpaste pack with the free toothbrush will face a levy on the combined value. And, in case two products face different rates of GST, the product with the higher levy will determine the tax rate on the packet.

The confusion had forced some restaurants serving Gujarati thali to make sweets optional as food products faced a 5% levy and sweets 12%. So, if sweets were included, GST on the thali read more »

09.03.2019

Rs. 246cr export and refund scam busted.

Mumbai: The rummaging & intelligence unit of customs busted a fake export racket of sending inferior goods overseas and declaring them ‘handicraft’. Claiming IGST refund and drawback, operators of the racket caused the government a loss of Rs 246 crore. The Nhava Sheva preventive unit of customs arrested an exporter-cum-customs-clearing-agent, Vishweshwar Tukaram Gaonkar.

Sources in the customs said Gaonkar’s activity is just the tip of the iceberg as many other exporters and custom house agents who worked as syndicate, claiming large IGST refund and causing loss to the exchequer are wanted.

Officials named some export firms, Dunox Trading & Exports, Bijoux Exports, Elantra Exports and Ronera Overseas. They said the syndicate misdeclared glass bangles as glass circlets that are tagged ‘handicrafts’, to claim IGST refund, drawback and its reward.

In containers at Nhava Sheva, cheap glass bangles were read more »

25.02.2019

GST move will make housing affordable: FM

New Delhi: The slashing of GST rates on under construction flats and affordable housing has come as a relief to home buyers, said finance minister Arun Jaitley on Sunday. “The GST Council has accorded big relief to the real estate sector... This will give boost to housing for all and fulfil aspirations of neo-middle class and the middle class,” Jaitley said after the decisions were cleared by the council.

Come April 1, a house with a carpet area of 60 square metres in a metro city and 90 square metres in non-metros will be put in the affordable category if it costs up to Rs 45 lakh.

Houses which receive construction certificate do not face GST and home buyers only need to pay the stamp duty for registration. The GST Council’s decision will benefit buyers who are currently on construction-linked payment read more »

25.02.2019

‘GST cut will benefit only home buyers, not builders’.

Mumbai: While industry has reacted with caution to the GST rate cut on under-construction projects, real estate experts said the biggest beneficiary will be stakeholders in the affordable homes segment because any property priced at Rs 45 lakh or below will now attract just 1% GST instead of 8% earlier.

Builder and president of National Real Estate Development Council (Naredco), Niranjan Hiranandani, said the GST rate cut will bring a “big relief ” to home buyers and help narrow down the demand mismatch gap. “This announcement gives an impetus to affordable housing and will enthuse homebuyers to close sale deals. But GST rate on cement has not been reduced as was expected; at 28%, it remains among the highest taxed inputs for construction —and there will be no input tax credit; so, developers will face a challenging time,” he said.

Mumbai-based read more »

25.02.2019

GST slashed from 12% to 5% on houses under construction.

New Delhi: The Goods and Services Tax Council on Sunday decided to slash the levy on under-construction houses to 5% with a special rate of 1% introduced for affordable homes, but opted to withdraw the benefit of tax credit on inputs such as steel, cement and paint, arguing that builders were pocketing the gains.

Currently, affordable housing faces an 8% effective rate with other under-construction apartments attracting 12% levy. The new rates will be effective from April 1 as the Centre and states will work out detailed rules and are expected to stipulate that a vast majority of inputs and capital goods be purchased from vendors who are registered to pay GST. The move is seen to be crucial to keep tabs on a sector ridden with cash transactions and black money.