GST Council likely to approve amendments to tax laws on Saturday

A host of measures to simplify the payment of tax, filing of returns, claim of refunds and advance ruling system would be on the anvil as the goods and services tax (GST) Council meets on Saturday. The required changes in the GST laws would be made once the Council achieves consensus on these changes, officials in the know said.

With regard to refunds and advance authority rulings (AAR), the Council will discuss the feasibility of a single authority with some conditions to ease the process. In a move that will ease the process for all taxpayers, the Council is likely to reduce the number of items one has to enter while filing summary output-input returns GSTR 3-B, they said.  

Currently, refunds are processed and disbursed by the Centre (CGST, IGST and cess) and the state jurisdictional authorities (SGST and IGST). The change, if approved, would make possible seamless pay-out of refunds to claimants, and the liability from Central GST and State GST will be settled at the end of the month.

Input-tax credit refunds amounting to Rs 53 billion, more than 10 per cent of all refund claims, are stuck due to deficiencies, the central board of indirect taxes and customs (CBIC) said in its press release earlier this month.

But officials said that this takes into account refunds cleared at the customs stage. If one considers the refund payment orders that get stuck at the level of Pay and Accounts Officers (PAO)—a lower and subsequent stage— the amount will  be higher.

“While the customs department clears refunds expeditiously, scrutiny at the state PAO level adds to delays and taxpayer hassles,” said a senior official on condition of anonymity.

On AAR, the multiplicity of applications in different states, and the conflicting rulings among them are the key issue faced by companies which have multi-state presence. Officials said that while the Centre is of the view that a single authority should be formed, states are not coming on board as of now.

The Council is likely to seek a consensus on this issue.

Further, in the process of paying GST, the return filer makes about 20 entries in lieu of tax payable, late fee, penalty, interest and others each for CGST, SGST, IGST and compensation cess.

The Council is likely to decide that the distribution into these four tax heads would be done at the back end. With this, the tax payer would need to fill tax payable, interest, late fee only once, reducing the chance for manual error.