Saturday, July 31, 2021

GST Day: completion of 4 years of GST

India marks the fourth anniversary of the Goods and Services Tax (GST) on Thursday, July 1, 2021. The date 1st July has been designated by the Central Government as ‘GST Day’, which is celebrated every year to mark the roll-out of the historic tax reform. Finance Minister Nirmala Sitharaman on Wednesday said that on GST Day this year, the Union Finance Ministry will issue appreciation letters to over 54,000 GST payers for timely filing of returns and a cash payment of tax.

Goods and Services Tax (GST)

The Goods and Services Tax (GST) is an indirect, multi-level, comprehensive tax levied on the supply of goods and services in India. On roll-out, GST subsumed almost all other domestic indirect taxes in the country (petroleum, alcoholic beverages, and stamp duty being the major exceptions) under one head, and is perhaps the biggest tax reform in the history of independent India. The GST is levied at every stage of the production process but is collected from the point of consumption, refunding all parties eventually other than the end consumer.

On completing 4 years of GST, Finance Minister Nirmala Sitharaman mentioned the journey of GST. Finance Minister stated the success of GST and measures taken to give relief to taxpayers, especially at the time of Covid.

Success of GST

India’s tax base has almost doubled from 66.25 lakhs to 1.28 crores in the last four years. GST revenue collection in India has been over the Rs 100,000 crore mark for eight consecutive months in a row with as much as Rs 102,702 crore collected in May alone, the Union Finance Ministry said earlier last month. This is despite the fact that many states remain under strict Covid-19 disease-enforced lockdown, the government said.

Ease the compliance burden on taxpayers

“Any reform of this scale, in a country as large and diverse as India, can only be exceedingly challenging. The GST Council has shown great foresight and wisdom in redressing legitimate concerns of taxpayers and citizens by course correction whenever needed. This is manifested in measures to reduce the compliance burden not only on the taxpayers, especially MSMEs, but also to reduce the tax burden on the common man,” FM Nirmala Sitharaman said.

Relief packages for increasing liquidity for taxpayers implemented

Stating that the relief measures worked out amid the pandemic, which has wreaked havoc in the world and adversely affected the global economy, is proof of such an approach. “Two COVID relief packages, which included, inter alia, late fee waiver, interest rate reduction, time limit relaxation and conduction of refund drive to increase liquidity in the hands of the taxpayer were implemented,” the Finance Minister said.

GST rates reduced on treatment of COVID

“Further, the GST rates on vaccines, essential drugs and products/services used for prevention and treatment of COVID were also reduced. In addition, quarterly returns and monthly payment schemes, e-invoices and auto-population of returns under the REAP project have reduced the compliance burden on the taxpayers to a great extent, making their lives simpler and better,” the Finance Minister said.

Complimenting the Central Board of Indirect Taxes and Customs (CBIC) and the State Tax Administration for working day and night during the last four years to make GST a success, FM Nirmala Sitharaman condoled the loss of 189 officers and employees of CBIC in the line of duty due to the pandemic. The Finance Minister said that the CBIC is releasing a book to pay tribute to these personnel and to remember their contribution to the national endeavour.

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