MSME Sector: GST Board to Take Further Relief Measures

This will be the second GST Council to be chaired by Goyal, who assumed office as finance minister due to the indisposition of Arun Jaitley. (Reuters)

Goods and Services Tax Board to Examine Exclusively the Issues of Taxpayers of Micro, Small and Medium-Sized Enterprises (MSMEs) at its 29th Meeting Scheduled for Aug. 4, An Official at the Ministry of Finance Finance. The field training courses of the Department of Indirect Taxation were asked to prepare a list of grievances and suggestions from small taxpayers, and to send them to the Central Board of Indirect Taxes and Customs (CBIC) for tax purposes. here Friday

. Piyush Goyal will hold a meeting with the Tax Department on Saturday to finalize matters to be considered by the council before preparing a formal agenda. This will be the second GST Council to be chaired by Goyal, who assumed office as finance minister because of Arun Jaitley's indisposition.

The Council met last Saturday 28,000 people. 5 crore annually to file returns on a quarterly basis even while they produce taxes every month. Similarly, the reverse charge mechanism (RCM), which has been cited as a major hurdle for MSMEs in the supply of unregistered dealers, has also been put on hold until September 30, 2019. RCM imposes on registered buyers the tax burden the supplier is not registered, resulting in an additional compliance burden.

Since MSMEs largely purchase raw materials from unregistered suppliers, the RCM provision was cited as a major impediment to doing business for these taxpayers. This is also reflected in the low level of compliance with the GST, where even after a year of introducing the tax, only 60% of eligible taxpayers file returns by the deadline.

"The reduction in the periodicity of these complies and the fact that the next meeting will focus on the issues of MSMEs would encourage further expansion of the GST tax base. It is very clear that the government is trying to address the concerns of a wide range of companies to ensure that the GST achieves its goals, "said MS Mani, partner, Deloitte India.

Experts said that MSMEs face GST compliance issues, including bandwidth restrictions, capital shortages, particularly because of delayed repayments and knowledge issues of the GST Act and related rules. "Stakeholders in the MSME sector have faced many challenges posed by demonetization, increasing inflation, shrinking demand, shrinking bank financing and disruptive implementation of the GST. The next board meeting aims to alleviate the difficulties faced by the MSME sector and the sector is anticipating innovative measures that go beyond simply streamlining compliance and tax rates, "said Rajat Mohan. Partner, AMRG & Associates.

The above-mentioned letter, which was reviewed by FE, asked the Principal Commissioners "to contact the MSME taxpayers and their trade and industry associations in their respective areas, to collect their GST-related grievances / issues with their suggestions for alleviating problems. "