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GoM favours deferment of sops for digital payments under GST by a year

Press Trust of India  |  New Delhi 

The Sushil led ministerial panel will recommend to the to defer by a year the proposal to incentivise digital payments under GST, citing revenue implications of doling out concessional tax rate.

The panel, in its meeting today, has decided to wait for stabilisation of revenues under and the new in the current fiscal before considering differential GST rates for people making payments using the digital mode.

Besides, another ministerial panel under Modi, on Reverse Charge Mechanism has decided to recommend powers to the to notify the registered persons who would come under RCM purview.

The meetings of the two Group of Ministers (GoM) were held here today.

The recommendations of these ministerial panels will be placed before the GST Council, chaired by and comprising his state counterparts, in its next meeting on July 21.

said the GoM on digital transaction has decided that this is not an opportune moment to incentivise digital payments as it will have revenue implication. "Let returns and GST revenues stabilise, then we can think about incentivising digital transaction".

"The GoM will be recommending to the Council that it may think about the proposal of incentivising digital transaction again after a year. The GoM is recommending deferring the proposal for a year," the said.

To incentivise digital transaction, the in its last meeting in May had discussed giving a concession of 2 per cent in GST rate (where the tax rate is 3 per cent or more) to consumers making payment through cheque or digital mode. The discount would be capped at Rs 100 per transaction.

The five member GoM on incentivising digital transaction include Gujarat Nitinbhai Patel, Amit Mitra, Haryana Excise & Capt Abhimanyu and

With regard to the decision on RCM, said the GoM will recommend that the GST Council will decide on the class of registered persons who would be required to deposit taxes on reverse charge basis.

"We have recommended omitting the present Section 9(4) and introducing a new Section 9(4) which will permit the government, on the recommendations of the GST Council, to notify specific class of registered persons, goods which would be covered under RCM provision," he added.

The conditions and the date for levying of RCM will be decided by the council, Modi noted.

Under the RCM in GST law, registered dealers are required to make tax payments in case they procure goods from unregistered businesses.

Currently, RCM, which is touted as an anti-evasion measure, has been deferred till September 30.

Manpreet Singh Badal, and Thomas Issac, among others are a part of the GoM on RCM, which was constituted in March by the GST Council.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Sun, July 08 2018. 17:30 IST