GST Panel recommends no extra tax incentives for digital transactions

Jul 9, 2018 15:24 IST
GST Panel recommends no extra tax incentives for digital transactions

A ministerial panel formed by the Goods and Services Tax Council on July 8, 2018 recommended that there shall be no additional tax incentives for digital transactions for a year, citing revenue considerations.

The panel headed by Bihar Deputy Chief Minister and Finance Minister Sushil Kumar Modi said that it may think about the proposal of incentivising digital transaction again after a year, once returns and GST revenues stabilise.

The panel claimed that it is not an appropriate moment to incentivise digital payments as it will have revenue implications.

The five-member Group of Ministers (GoM) on incentivising digital transaction include Gujarat deputy chief minister Nitinbhai Patel, West Bengal finance minister Amit Mitra, Haryana excise and taxation minister Captain Abhimanyu and Punjab finance minister Manpreet Singh Badal.

Note

The GST Council in its last meeting in May 2018 had discussed about offering a 2 percent concession in GST rate (where the tax rate is 3 percent or more) to consumers making payment through cheque or digital mode.

GoM on Reverse Charge Mechanism

• Another ministerial panel chaired by Sushil Kumar Modi on Reverse Charge Mechanism (RCM) recommended replacing the present Section 9(4) with a new Section 9(4) which will permit the government to notify specific class of registered persons who would be covered under RCM provision.

• The notified class of registered persons would be required to deposit taxes on reverse charge basis. The conditions and the date for levying of RCM would be decided by the council.

• Under the Reverse Charge Mechanism, registered dealers are required to make tax payments in case they procure goods from unregistered businesses. At present, RCM has been deferred till September 30, 2018.

• Punjab finance minister Manpreet Singh Badal and Kerala finance minister Thomas Issac, among others, are a part of the panel which was constituted in March 2018 by the GST Council.

The recommendations of both these ministerial panels would be placed before the GST Council at its next meeting on July 21, 2018.

 

Is this article important for exams ? Yes1 Person Agreed

Latest Videos

Register to get FREE updates

    All Fields Mandatory
  • (Ex:9123456789)
  • Please Select Your Interest
  • Please specify

  • ajax-loader
  • A verifcation code has been sent to
    your mobile number

    Please enter the verification code below

This website uses cookie or similar technologies, to enhance your browsing experience and provide personalised recommendations. By continuing to use our website, you agree to our Privacy Policy and Cookie Policy. OK