Taxation

GST : Whatsapp Rumors and Myths vs. Reality

GST : Whatsapp Rumors and Myths vs. Reality

GST one of the biggest tax reform in history of Independent India is effective since 01 July 2017. Still a majority of the population is amidst all the rumors and confusions prevailing in the social media about its impact and functionality. Let’s try to understand if it is really that big an issue or it’s just a political hype being created in the country.

Invoice Generation Online

Messages are being floating on whatsapp that traders have to prepare GST invoices on the GST portal, this is not true. You can prepare invoices either by software or manually. You just need to take care of the required invoice guidelines prescribed under the act. Finance Secretary Mr. Hasmukh Adhia has time to time issued clarifications via twitter handle

37 Returns for Regular GSTN Holders

Strength of the GST model lies in the information technology usage for seamless flow of credit. Effective usage of technology is making the process easy for traders with no duplicate efforts. Out of 37 returns being talked about, 3 monthly returns and one annual return. Out of the three monthly returns, traders have to fill only the 1st return by 10th of succeeding month either manually or through software. 2nd return is just the auto generated memo of GST paid by you during various purchases made or expenses incurred and the third is summary of both of them. Therefore actual effort is required only in the 1st return; rests are more of a review based return. You can consider it as a single return per month with 3 parts.

Invoice Level Detail in GST Return

This information is partially correct. For traders who are providing services or goods directly to consumers need not to upload invoice level data in their GST returns therefore, all B2C businessmen and professionals can file returns with consolidated rate wise sales data. Invoice level data is only required for businessmen who are passing on the tax credit to the buyer.

Poor internet connectivity

Lot of concerns are being raised by various sections of the society that still the common man does not have necessary reach to the internet in order to comply with GST. This is more of a hoax. GST compliance has to be made monthly by the traders who have turnover greater than Rs. 75 lakhs or manufacturers having turnover greater than Rs. 20 lakhs. For traders having turnover between 20-75 lakhs opting for composition scheme needs to file returns every quarter end. Therefore internet connectivity shall not be a big issue to cater the top most segment of the society who is running businesses with handsome turnover.

GST Rates higher than Existing rates

A normal consumer compares GST rates with the rates he sees on the retail bills i.e. VAT and forgets about the Excise Duty, Entry Tax etc. being included in the base price before charging VAT. Also the consumer does not account for the credit flows that use to restrict excise credit under VAT. Therefore consumer needs to add all kinds of subsumed duties while comparing the rates with GST. I am sure then you will not be disappointed as equivalent rates will also lower the prices due to removal of cascading effect.

Inspector Raj

This is again a hyped rumor being floated. Imagine how you comply with income tax as businessmen, same is the way forward under GST. Previously businessmen use to get the books and returns assessed by the VAT/Excise department in year or two and use to face lot of harassment. Under the GST regime, government has allowed self assessment mode meaning, you need not visit any officer if you are filling your returns timely and getting your GST audit done. Similar to scrutiny procedure in Income tax, GST officers will have powers to call on GSTN holders on sample basis to review the compliance quality. This is more of a fear in the minds of people who are willful tax evaders.

GST India Mygov

Source Mygov

Overall we should now focus on real information rather than whatsapp rumors. Instead we should not even forward information received by us from unverified source. Get in touch with your tax consultant or chartered accountants for real information. CA institute ICAI has also setup GST help-desk across its branches in various cities; you can reach out to them in order to verify any information.

3 Comments

3 Comments

  1. Pingback: Impact of GST on SME Sector - Finance Minutes

  2. Pingback: One Month Of GST: Promising Future with Less Hiccups - Finance Minutes

  3. Pingback: Worried About Input Tax Credit under GST? FAQs and Answers

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