Digvijaya Singh urges Arun Jaitley to change CGST bill provisions

Says provisions would affect India's ranking on ease of doing business

Congress leader Digvijaya Singh has urged Finance Minister Arun Jaitley to reconsider and amend clauses 37, 38, 39 and 44 of Chapter IX of The Central Goods and Services Tax Bill saying it demands the tax payer to submit 37 forms in a year, up from 4 forms that he gives every quarter at present.

The law, said Singh, would affect India's global ranking in ease of doing business, which the government has been promising. Further, the Congress leader said that a mistake in one return would lead to mismatch because of which the tax payer won't get the benefit of input credit. Noting the provisions would defeat the very purpose of GST and on each transaction, tax would be levied, Singh said it would have a cascading effect resulting in inflation.

The Congress Rajya Sabha member reminded the finance minister that he, in response to the issue raised in parliament earlier, had said that the tax payer has to submit his returns only quarterly.

"You would agree that instead of reducing the number of returns you have increased it by 9 times," Singh wrote to Jaitley in his letter dated April 7, 2017.

The Congress released copies of the communication between Singh and Jaitley on the issue.

In his letter to Singh dated April 18, the finance minister replied that in the proposed GST design the tax payer has to file only his initial return on the 10th of the next month while the other returns on invoice matching and availment of ITC credit are auto-populated.

Noting a scheme of quarterly returns has been proposed for smaller taxpayers below Rs 50 lakh turnover per year, the finance minister said it is not workable for all tax payers because input tax credit has to be given every month.

Singh again wrote to Jaitley over the issue on May 6 saying it appears those who examined the matter had not stated the actual legal provision to the minister correctly.

He further said that those with turnover more than Rs 50 lakh are not better than those with less than Rs 50 lakh because margins of profit are less and expenses for compliance would substantially reduce actual profit.

Singh pointed that traders in small towns and villages would not find suitable persons who can help them with making compliance of GST hence they would have to rush to bigger towns where the cost would be higher.