Presentation highlighting: 1) Challenges Faced in the implementation of GST in India 2) Status of GST in India 3) Open Practical Issues in GST 4) Future Roadmap of GST Disclaimer - This content is purely for Educational Purpose only. Take Professional consultation before taking any decision based on the contents of this presentation. We shall not be responsible for any loss, whatsoever caused therein.

1. GST Implementation in
India
Status Check and Future Roadmap

2. Coverage…

3. Journey so Far…
* Source: CBIC Presentation titled ‘GST – An Update’
*Source: CBIC Presentation titled ‘GST – An Update’

4. Challenges in
Implementation of GST
Major challenges faced in the implementation of
GST

5. Challenges faced so far…
Origin-based versus Destination-basedTaxation
TheVAT
Regime was
based on origin
principle.
Many manufacturing
States expressed
concerns over the loss of
revenue on account of
shift from origin based to
destination based
States put forward an
argument that they
need to recover the
cost of infrastructure
and public services
provided to the
industries

6. Challenges faced so far…
Rate Structure and Compensation
Uncertainty about the
gains after
implementation of GST
and difficulty in estimating
as to how much the States
will gain
RNR of 15-15.5%
was suggested.
States asked for
compensation
during the first five
years of
implementation of
GST

7. Amendment in
the Constitution
to confer
concurrent
powers on Centre
and State to levy
tax on Goods and
Services
Inclusion or
exclusion of
Alcoholic Liquor
for human
Consumption
and Petroleum
products in/from
GST
Transition
challenges
e.g. carry
forward of
VAT &
Cenvat
Credits &
like
Settlement of
Disputes arising
between Centre
and States or
between States
Challenges faced so far…

8. Status Check
• Government measures so far to resolve contingent issues and
practical difficulties
• Have we really implemented 100% of the intended law?

9. RCM Provisions
Extending Benefits of
Composition Scheme
Deferring payment of
tax on Advances for
Goods
Constitution of National
Appellate Authority for
Advance Ruling
• Earlier deferred until 30.09.2019
• Now, amended to be made applicable
only on specified class of registered
persons in respect of specified supplies
• Aggregate Turnover limit extended
to Rs. 1.50 Crore
• Scheme made available to supplier
of services with a tax rate of 6%
• Facing outrage from industry and
commerce, government had
deferred payment of taxes on
advances received for goods.
• Provide advance rulings on
conflicting decisions on the same
issue by two or more State Appellate
Advance RulingAuthorities

10. Increasing thresholds for Registration
States with threshold
limit of Rs. 10 lakh for
both goods and services
Manipur
Mizoram
Nagaland
Tripura
States with threshold
limit of Rs. 20 lakh for
both goods and services
Arunachal Pradesh
Meghalaya
Sikkim
Uttarakhand
Puducherry
Telangana
States with threshold
limit of Rs. 20 lakh for
services and Rs. 40 lakh
for goods**
Jammu & Kashmir
Assam
Himachal Pradesh
All other States
** persons engaged exclusively in supply of goods

11. Status Check: No. of Registrations
0
2000000
4000000
6000000
8000000
10000000
12000000
14000000
No. of Registrations
(as on 31st May, 2019)
13543560
1774379
Total No. of Taxpayers
Composition Dealers

12. Status Check: E-Way Bill
Successfully
implemented from
01.04.2018 for inter-state
movement of goods
All the states have also
implemented E-Way bill
system for intra-state
movement of goods
No. of E-Way bill generated for
Inter –State movement – 37.12 Crore*
Intra –State movement – 3.17 Crore*
Barring generation of
E-Way bill, if a supplier
or recipient does not
file GST returns for 2
consecutive tax periods
* As on 31st May, 2019

13. Status Check: Other Major Provisions
Doing away with concept of BusinessVerticals
Multiple registrations in a state possible for each place of business
TDS &TCS Provisions
Implemented w.e.f. from 01.10.2018
National Anti-Profiteering Authority
Tenure of NAPA entended by 2 years So far, NAPA rendered order in approx. 73 cases

14. Open Issues and Future
Roadmap
•What are major open issues under GST for future course of
action by Government…?
•What is the future roadmap…?

15. Top Pressing Open Policy Issues
SetoffofITC
As amended recently, now
IGST needs to be
exhausted completely first,
before utilization of CGST
& SGST
This has led to additional
working capital blockage and
unnecessary accumulation of
ITC
Sec-16(2)(c)
Currently, Sec 16(2)(c)
denies credit to the
taxpayer if tax charged is
not paid by supplier
Here, Supplier is the
defaulting person. And when
govt. knows the GSTIN of
both the persons, action
must be taken against the
defaulting person

16. Difficulty out of New Rule 88A
Particulars IGST CGST SGST
InputTax Credit 200 100 100
OutputTax Liability - 200 200
Example:
Pre –Amendment:
Particulars IGST CGST SGST
OutputTax Liability - 200 200
Less: ITC
CGST/SGST 100 100
IGST 100 100
Payment in Cash - - -

17. Difficulty out of New Rule 88A
Post –Amendment:
Particulars IGST CGST SGST
OutputTax
Liability
- 200 200
Less: ITC
IGST - 200 -
CGST/SGST - 100
Payment in Cash - - 100
Balance ITC - 100 -

18. Top Pressing Open Policy Issues
Charging tax on exempt
supplies of Composition
dealer
• Manufacturers and
services providers
under composition
have to pay tax on
‘Turnover in the
State’ which includes
exempt supplies
Blocked Credit under
section 17(5)(c) & (d)
• Recently, in a writ
petition, Hon’ble Orissa
High Court allowed the
credit of input used in
construction of malls to
a supplier engaged in
renting of shops in the
mall

19. Top Pressing Open Policy Issues
Contrary Export
Provisions
• An exporter is allowed
export of goods on
payment of IGST or
without payment of IGST
• While Refund is denied of
accumulated credit of
Capital Goods; same can be
used for payment of IGST
Cross Charge
• Karnataka AAR has ruled our
that activities performed by
employees at Corporate
office for distinct persons
shall be treated as supply
• Recently, Finance Ministry
also came out with a draft
circular on chargeability of
cross charge services
between HO and Branches

20. Future Roadmap…

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