The GST Council on Friday, in its 27th meet, approved the principles for filing of new return design based on the recommendations of the GoM (group of ministers) on IT simplification. Kerala Finance Minister Thomas Isaac, one of the vocal critics of the sugar cess, is part of the panel headed by his Assam counterpart Hemant Biswa Sarma.
The council, at its 27th meeting, also referred the issue of incentivising digital payments to a group of state finance ministers after some states wanted a negative list. Thereafter, GST filers would have to file a single monthly return.
A unidirectional flow of invoices submitted or uploaded by the seller in a course of time would be a valid document for availing input tax credit.
No automatic reversal of credit: There will not be any automatic reversal of input tax credit from buyer's side on non-payment of tax by the seller.
In the transitional phase, there will be a separate column for the provisional credit that could be granted to the tax payer, but the returns have to be filled within 3-4 months and taxes have to be paid or else the credit will cease to exist.
While the Council discussed the possibility of imposition of sugar cess and incentives to promote cheque and digital payments, it could not reach consensus on these two topics.
While the cost of sugar production is over Rs 35 per kg, the market price is around Rs 26-28 a kg, he said, adding cane growers are in deep distress and a proposal to levy a cess was made to help them.
To optimally manage the IT load on the system, different tax filing dates would be announced, based on the volume of transactions.
According to the proposal, a 2 percentage point discount will be available in the GST for those paying digitally, subject to a ceiling of Rs 100 a transaction.
At present, 51% stake is held by private entities, valued at Rs5.1 crore, with the centre and the states holding 24.5% each.
The government now owns 49% in the GST Network. Finance Minister Arun Jaitley said that cess on sugar products will be considered.
The revenue collection from GST has crossed Rs 1 lakh crore in April, signifying stabilisation of the new indirect tax regime that was rolled out in July 1 previous year.
After the proposed change in shareholding pattern, the Centre will own a 50 per cent stake and the rest will be held collectively by the states. Another view was to have a "negative list" of items, on which this incentive would not apply.
Once the decision is taken by the GST Council, the government would come out with an ordinance to impose cess on sugar, said finance minister Hasmukh Adhia.