The proposals of the Legal Committee of the GST Board of Directors, made up of central and state officials who advise their ministerial members, aim to toughen compliance procedures and target restrictions on companies that have been identified as risky.
Reform of the Goods and Services Tax (GST) registration process and suspend the registration of companies that have been identified as risky are some of the proposals of a committee of officials attached to the GST Board.
The Finance Ministry said the proposals put forward by the GSTB Legal Committee, which includes central and government officials advising its ministerial members, are aimed at tightening compliance procedures and targeting restrictions on companies that have been identified as risky. , without affecting the ease of doing business in any way. Public. Official.
Recommendations include the use of Aadhaar or Aadhaar-like biometric identification for new registrations, steps to identify companies that present a risk of loss of income to the treasury, use of income tax returns to verify the credentials of entrepreneurs seeking to register GST, and restrictions on the use of purchase tax exemptions. Raw materials to meet the final tax.
If GST returns are not submitted for six months, registration can cost the business. Currently, there are 600,000 dormant companies registered with GST out of 12 million registrants.
Entities wishing to register GST will be rated based on their credentials, Trustworthy ranking, and others.
Trusted entrepreneurs are those who have a reliable history of paying income taxes and have their identity certified by Aadhaar and have no history of de-registering for GST.
These entrepreneurs will receive a GST registration within a week. The aforementioned ministry official said that others will be granted registration within two months of the physical verification of commercial buildings.
Untrusted ones may also be required to pay a portion of their tax liability in cash rather than adjusting it entirely against the tax credit available to them.
The official, who requested anonymity, said the proposals put forward by the legal committee at a meeting last week will be discussed further before presenting them to the council.
The move signals a major tightening of the three-year-old indirect tax system that takes advantage of GST's ability to trace the entire supply chain with the entry tax credit system. Discrepancies will be flagged as GST's filing registration system becomes more automated with electronic invoices and self-completed tax returns.
Goods and Services Tax (GST) authorities were on a national campaign to enforce compliance this month, resulting in a violation of the law and the arrest of 48 people and three public accountants. So far this month up to 648 cases have been registered.
The government is better armed to enforce greater compliance with deep digital capabilities to automatically detect evasions, leaks, defaults and delays, according to Rishi Agrawal, co-founder and CEO of Avantis Regtech Pvt. Ltd, which is a regulatory technology company. Sooner rather than later, India Inc. will need to focus on accurate and timely compliance. "Ignorance of the law will not be an excuse for non-compliance," Agrawal said.
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