Simpler GST filing module proposed by Nilekani may be finalised on Mar 10

The GST council would look at finalising the module proposed by Nandan Nilekani to simplify filing of returns in its upcoming meeting on March 10, an official said on Wednesday.

"The biggest glitch now in the system is the GST returns. The GST return filing is being simplified. Nandan Nilekani has come out with a fantastic module and a committee has been set-up to discuss all of it and then submit a report.

In the 26th council meeting on March 10, they will most probably be discussing and finalising it," GST commissioner M&E sectoral group M Srinivas told PTI on the sidelines of the Ficci Frames here.
 

In the 23rd GST council meeting, it was decided that filing of GSTR-2 and GSTR-3 forms would stop and only the filing of GSTR-1 and GSTR-3B would continue.

However, he conceded that the present return filing system is still cumbersome for taxpayers and cost of compliance has gone up mainly because people are not able to handle the present system of filing returns.

According to the recommendation made by Nilekani, instead of supplying invoices to be uploaded, a module can be formed where supplying invoice details can be posted, and based on the invoice data fed by the supplier, the system by itself generates the return.

"So the system will become much simpler and them compliance levels would go up. This is the major glitch that is being addressed now," said Srinivas.

According to him, the (return) filing system would stabilise in another three to four months, latest by June.

Srinivas noted that with the introduction of the goods and services tax (GST), the indirect taxpayer base has expanded by more than 50 per cent with 34 lakh businesses coming into the tax net.

The GST collections in July last year was over Rs 950 billion, which he attributed to higher tax rates and non-availability of refunds.

"The TRAN credit, credit existing in the previous regime, was not allowed to be taken and it was very heavy and the relevant TRAN 1 module was not ready on the GST network. Since the people could not take the earlier credit in balance and use it, everybody had to pay by cash.

Secondly, the tax rates were much higher and they were rationalised subsequently. Over 250 commodities tax were reduced and that of over 100 services as well," he said.

The collections came down to Rs 808 billion in November as due to the arrival of TRAN, tax rates reduced and simultaneously the refund was also permitted.

"The refunds were held up for sometime, so the manual processing of ITC accumulated on accounts of permission and this has enabled cash payment and that resulted in a deep slump," he said.

The collections increased to Rs 867 billion in December and was at Rs 863 billion in January.

According to Srinivas, since only 69 per cent had filed returns for January as per the data, the figures are expected to rise with late payment fees.