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Press Reports on GST 03-04-2017

GST Will be Implemented From July 1: Arjun Meghwal

Kolkata: Union Minister of State for Finance Arjun Ram Meghwal on Sunday expressed confidence
that the historic tax reform Goods and Services Tax (GST) will roll out from July 1.

"100 percent GST will be implemented from July 1," Meghwal said here when asked on GST roll out.
"In the last meeting four rules had been approved and the next meeting is in Srinagar," he said on the
sidelines of ICC organised on investment opportunities in African country Democratic Republic of
Congo.

Adding further, he said, the government will resolve the problems of the trade and if GST begins from
July 1, there will be no loss to trade and industry.

On March 29, Lok Sabha approved the four supplementary legislations.

The Central GST Bill, 2017; The Integrated GST Bill, 2017; The GST (Compensation to States)
Bill, 2017; and The Union Territory GST Bill, 2017 were passed after negation of a host of
amendments moved by the opposition parties.

The Council, however, deferred a decision on tax structure to its next meeting on May 18-19.
Meghwal said that states are been told to strengthen their IT infrastructure and focus on manpower
training.

"Trade, chambers are suggesting. We are continuously meeting them and communicating the benefits.
If there are some problems..we will solve it," the minister said.

He said that the government will open guidance centres including in the villages where internet is
available to support the trade in getting registered with GST.

New 18, 2 April, 2017

Education, healthcare will continue to remain out of service tax under GST
New Delhi: The Centre has decided to continue to keep Education, healthcare, and pilgrimages out of
service tax net even under the GST regime.
Besides making a strong case to the GST Council for not touching services that are out of tax net
currently, the Centre will also pitch for keeping concessional rate for services like transport at the
current level, Revenue Secretary Hasmukh Adhia told PTI in an interview.
Led by the Union Finance Minister Arun Jaitley, the GST Council is scheduled to meet in Srinagar on
May 18-19 to decide on rated of various goods and services that will be charged in GST, targeted for
rollout from July 1.
Adhia said the endeavour would be to maintain the current tax incidence on a commodity or service at
the same level in the new Goods and Services Tax (GST) regime.
The most-awaited GST will include charges like excise duty, service tax, VAT and other levied
charges to make for a national sales tax that will be levied at the time of use of a product or service.

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Adhia said the approach for the GST rollout would be to avoid any shock in the first year and any
review for inclusion of a service or change in rate could be done in the second or third year of the
implementation based on revenue realisation.
"Our entire purpose will be that we don't upset anything that is there now. We will try to do some
smooth landing. So we will recommend to GST Council that whatever is the existing exemption list
for service tax they should continue because we cannot do too many things at the same time," he said.
Currently, there are 17 items in negative list of services on which service tax is not levied.
On top of that there are over 60 services, like religious pilgrimage, healthcare, education, skill
development, journalistic activities which are exempt from service tax.
Asked if these services would be kept exempt from GST, Adhia said: "We presume so... We will
recommend to the GST Council that whatever is in the exemption list they should continue in the first
year."
He said the main service tax rate will be standard rate of 18 per cent.
"But there may be items of services where abatement (concessional rate) is given for valid reasons. So
those items, because there will be no provision for abatements (in GST), we will have to fit them in
the rates closed to the present incidence," he said.
The GST Council has approved a four-rate tax structure of 5, 12, 18 and 28 per cent. Adhia said
transport sector, for example, currently gets abatement of 60 per cent and only 40 per cent of the
present service tax rate of 15 per cent is being collected.
And so, the tax in the GST will be fixed in the closes bracket of 5 per cent, he said. Asked if rates for
certain services will go up because current tax rate is 15 per cent and the nearest bracket that would
not upset the revenue collections is 18 per cent, he said, "some services may become a little more
expensive."
The exact ones that become expensive or cheaper will be decided by the GST Council, he said. On the
issue of crude oil, petrol, diesel, aviation turbine fuel (ATF) and natural gas being kept out of GST net
for the time being by continuing with existing taxes of excise and VAT, Adhia said the GST Council
decided that to give states comfort of revenue collections.
"For them it is some kind of a risk insurer. That 30 per cent income is already assured. Now 70 per
cent (of products and services) they are putting it into the common kitty," he said.
States, he said, want to wait and see how much revenue is generated in the GST regime. "So, after a
year or two if they find that the buoyancy (in tax revenues) is good, they could very well like to bring
it (petroleum products) in GST," Adhia added.
Times Now, 2 April, 2017

Only credible plaint to trigger GST anti-profiteering clause

NEW DELHI: The contentious anti-profiteering measure in the goods and services tax (GST) law will
be triggered only if there is a credible complaint, Revenue Secretary Hasmukh Adhia said.

He said the anti-profiteering clause in the law is meant to be a deterrent and is an enabling clause so
that reduction in tax incidence due to the GST is passed on to consumers.

Adhia told PTI that the Centre and states will in due course prescribe the procedure for filing a
complaint where the complainant feels that the benefit of tax cut has not been passed on to him as
well as the quantum of penalty to be imposed.

Asked who will decide if the benefits have been passed on or not, he said: "It would be based on

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complaints... Anti- profiteering provision may not be required in majority of items because wherever
there is perfect competition, there is nothing to worry. Competition will take care."

Adhia, however, said it was not yet decided which agency will look into the anti-profiteering
complaints. The government may decide on an agency if there is a plethora of complaints.

The agencies at the government's disposal include the Competition Commission of India (CCI).

Adhia also said that although the anti-profiteering clause could be a transitory provision, it can be
retained as the provisions can come into play in future when the tax rates are changed.

Asked if the anti-profiteering clause could cease to exist after some time, Adhia said: "It may. But
somebody may also argue that there may be future changes in the tax rate also and at that time, this
(anti-profiteering) provision may have to be applied."Adhia said: "It may. But somebody may also
argue that there may be future changes in the tax rate also and at that time, this (anti-profiteering)
provision may have to be applied."

The GST Council has decided on a four-tier rate structure of 5, 12, 18 and 28 per cent. It has,
however, pegged the peak rate at 40 per cent in the law to obviate the need to approach Parliament in
future for any change in rate.

On top of the 28 per cent rate slab, there is a provision for imposition of cess on demerit and luxury
goods.

Adhia said that if tax revenues go up in future because of widening of tax net, GST rates can be
reduced.

"The purpose is over a period the high taxation rate should come down... The moment we are able to
widen the tax net and bring parallel economy into mainstream, then the tax net will go up and if more
people start paying taxes, we will be able to reduce the tax rate," he said.

The Central GST (CGST) law, as approved by the Lok Sabha last week, provides an 'anti-profiteering'
clause to ensure business passes on the benefit of reduced tax incidence on goods or services or both
to consumers.

It also provided for establishment of an authority for ensuring the benefits are passed on to
consumers.

Touted as the biggest taxation reform since Independence, GST will subsume central excise, service
tax, VAT and other local levies and make India one market for seamless flow of goods and services.

Economics Times, 3 April, 2017

Under GST, tax evasion over Rs 5 crore a non-bailable offence

In a revised set of FAQs on GST, the CBEC said other offences under the act are non-
cognizable and bailable.

Doubling the threshold for cognizable offences, the government has decided to make tax evasion of
over Rs 5 crore under the proposed Goods and Services Tax (GST) regime as a non-bailable offence,
with the police having authority to make an arrest without a warrant. The earlier threshold for treating
tax evasion as a cognizable and non-bailable offence was proposed to be at Rs 2.5 crore. The Central

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GST (CGST) Bill provides that if the offences relating to taxable goods and/or services where the
amount of tax evaded or the amount of input tax credit wrongly availed or the amount of refund
wrongly taken exceeds Rs 5 crore, it shall be treated as cognizable and non-bailable.

In a revised set of FAQs on GST, the CBEC said other offences under the act are non-cognizable and
bailable. The government has set a target date of July 1 for rollout of the GST, which will subsume
central excise, service tax, VAT and other local levies.

As per the FAQs, cognizable offence means serious category of offences in respect of which a police
officer has the authority to make an arrest without a warrant and to start an investigation with or
without the permission of a court. Non-cognizable offence means relatively less serious offences in
respect of which a police officer does not have the authority to make an arrest without a warrant and
an investigation cannot be initiated without a court order, it said.

Outlining the safeguards to be taken during arrest, the FAQ said if a person is arrested for a
cognizable offence, he must be informed in writing of the grounds of arrest and he must be produced
before a magistrate within 24 hours of his arrest.

If a person is arrested for a non-cognizable and bailable offence, the Deputy/ Assistant Commissioner
of CGST/SGST can release him on bail and he will be subject to the same provisions as an officer in-
charge of a police station under section 436 of the Code of Criminal Procedure, 1973. The FAQ
provides that, if a person does not appear before a CGST/SGST officer who has issued the summon,
he is liable to a penalty of up to Rs 25,000.

Indian Express, 3 April, 2017

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