Poor collection mars GST flat-rate scheme

A five per cent tax is levied on restaurant owners, two per cent on traders and one per cent on manufacturers under the composition scheme

The composition scheme has yielded just Rs 215 crore in the first quarter since the goods and services tax (GST) was introduced. The number has accentuated the worries of falling GST tax collections that declined to the lowest in November, prompting tax officials to pin their hopes in the upcoming electronic-way (e-way) bill that will track movement of goods. 

The composition scheme allows small enterprises to file a flat tax rate without input tax credit once in a quarter. Of the 1.1 million assessees in the scheme between July and September, only 600,000 submitted returns, sources said.

This roughly translates into