Finance Minister Nirmala Sitharaman was on a two-day official visit to Hyderabad and Bengaluru on February 16 and 17 to hold interactive sessions with various stakeholders on Union Budget 2020-21.
Key takeaways from Indirect taxes are as follows:
1) With regard to interest on gross liability/ net liability on delayed payment of GST, Finance Minister mentioned that bill for amendment to pay interest on net liability is passed by all the States except Telangana and West Bengal, so it is still under process.
2) With regard to ITC restriction @10% over and above 2A, she mentioned that the buyer have to make proper arrangement with supplier. Before Oct'19 people have taken huge disadvantage of credits due to relaxed regime, even without supporting documents. Further she mentioned that GST law does not even allow such 10% of ITC. Hence, further relaxation cannot be given
3) No answer on refund of ITC on capital goods in case of refund application filed for accumulated ITC on inputs and services.
4) For MEIS policy for FY 2020-21, Finance Minister mentioned Govt is in process of making alternative scheme as present policy is WTO incompatible.
5) For system glitches in GST portal, she mentioned that such issues would be out once new returns, e-invoicing are in place from April 2020.
6) As even after 2.5 yrs of implementation of GST, there are many doubts with taxpayers, she urged GST officers to spread awareness and clarifications in GST.
7) FM also mentioned that cancellation of registration and blockage of ITC is happening only in cases of suspected frauds.
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