GST rates: CBEC says no changes unless anomaly seen

NEW DELHI: The goods and services tax (GST) rates will not be revised unless there is an anomaly or the rates are unjustified, the central board of excise and customs (CBEC) chairperson Vanaja Sarna said on Wednesday. However, she assured the industry that revenue authorities will go slow in undertaking enforcement actions under GST for the first six months to give businesses adequate time to settle down into the new indirect tax regime.

On Tuesday, textile traders in Surat called off their two-week strike against 5% GST following the Centre’s assurance to look into their demand of a roll-back. However, Sarna insisted that a rate change was possible only if an earlier oversight came into light. “The issue is that (some segments of the) textile sector are taxed for the first time, so anybody who comes into the net would feel the pinch,” Sarna said at a CII event here.

“With the kind of input tax credit (ITC) being offered, the assessee base will widen. I’m definitely not looking at any hardline attitude to start with, we would want it to settle down,” Sarna said.

 

  

FE had reported earlier that nearly 7.4 lakh new businesses have registered for GST since June 25 when the registration for new taxpayers was opened. With migration of over 70 lakh existing taxpayers into the GST system and another 7.4 lakh new taxpayers, the total GST taxpayer base is numerically close to the previous Centre-state indirect tax assessee base of 80 lakh. The taxpayer base must have expanded already as a section of taxpayers used to register separately for excise/service tax and VAT in the previous regime.

On the enforcement issue, the CBEC chairperson said that the department had legacy issues to deal with, and “we are not plunging into this (GST compliance) now”. She added that there will be genuine errors due to lack of understanding in the initial days.

GST was rolled out on July 1 and over 1,200 goods and 500 services have been fit into four tax slabs: 5%, 12%, 18% and 28%. Besides, there is zero tax on many items and separate rates for gold and precious metals.

Source::: Financial Express, dated 20/07/2017