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Key decisions about GSTR 3B and eway bills in GST council meet on March 2018


The GST council concluded its 26th meeting on 10th March 2018. The council decided to continue the current system of filing Form GSTR 3B for the next three months. A Group of Ministers (GOM) on the IT was entrusted the task of looking in the Tax Filing process. This GOM will consult tax experts and then take a call. It was expected that the GST council would simplify the return filing process. However, it could not reach a consensus on a simple GST return form. Now, Sushil Modi along with the ministerial panel will work on a single page form that would be simple to fill and evasion-proof.

The GST council could not reach a decision about selection of one of the two models presented for the filing of returns. The tax administrators presented one model, and Nandan Nilekani presented the other. The political executive thought that the latter was simpler and was comfortable with it. But, the tax administration opined that it would provide a possibility of tax evasion.

The E-way bill for inter-state movement of goods will become mandatory from 1st April 2018. All the states in the nation were divided in four groups for the implementation of the E-way bills. In each week, one new group will be added to the implementation. So, the aim is to complete the rollout of these E-way bills by the end of April. These e-way bills are for movement of goods of value at least Rs. 50,000. This electronic system will be implemented to ensure that the suppliers compulsorily logged and tracked goods within state borders. Thus, it is an anti-tax avoidance measure.

Till date, approx. 9.5 lakh taxpayers have already completed their registrations on the portal of the e-way bill.  As part of the trial runs, approx. 6.5 lakh e-way bills are being generated per day. Thomas Isaac, the Kerala Finance Minister, was skeptical about the introduction from 1st of April. His observation was that the IT systems were not more prepared than the start of February 2018, when the e-way bill system crashed. Isaac said that some more ministers were also seeking a guarantee that the system will not crash again.

The e-way bill for intra-state movement of goods will be rolled out from 15th April 2018 in stages. It will cover the entire nation by 1st of June.

Certain tax exemptions that were earlier given to exporters till March 2018 have been extended for a further period of six months. On Dec. 16, 2017, the Council agreed that the permanent solution was to begin an e-Wallet scheme. Such wallets would be credited by the Directorate General of Foreign Trade (DGFT) with virtual or notional currency. The exporters would use this currency to disburse the payment on imported/procured goods. Thus, their funds would not be blocked. On 10th March 2018, the Council detected that some preparatory work was completed. However, work related to numerous administrative, legal, and technical issues that were identified was pending. So, there was need of more time for this work. The unanimous decision was that till then, the exports should not be hampered. Thus, the implementation of the e-Wallet scheme has been postponed by 6 months. Till March 31, the exporters would have to disburse 0.1 percent on merchant exports as a nominal Integrated GST rate.

Reverse charge applicability on supply from an unregistered person was deferred until July 2018. Till then, a GOM would monitor the modalities of its implementation so that the trade and industry do not face any inconvenience.

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