GST Enrolment of existing VAT assesses

|| Om Shree Ganeshaya Namah ||

  

28-11-2016

 Dear Readers,

 GST Enrolment of existing VAT assesses

Amidst the demonetisation turbulence, the smooth transition to GST is facing some jerks in the form of various States expressing its disagreement on the proposed administrative control under the GST regime, the proposed highest tax slab rate (28%) being considered as regressive, etc. 

Regardless, the Centre is keen to roll out the GST law by 1^st April, 2017 and accordingly have initiated the enrolment process on the Common Portal maintained by GSTN @ www.gst.gov.in

All the existing taxpayers under the Central Excise, Service Tax, State Sales Tax/VAT, Entry Tax, Luxury Tax and Entertainment tax are required to get enrolled on this portal.  In the first phase the assesses who are registered with State VAT department are eligible to enrol as the prescribed time table.  There is no paper based enrolment or deemed (auto) enrolment.

The Procedure for Enrolment of existing VAT assesses is given below:

1.   To login to the GST common portal a provisional Id and the Password is required to be obtained from the existing Sales Tax/VAT Authorities. 

2.   With the use of the provisional Id and the Password, the assesse to login to the common portal and to create its new username and password, with a valid e-mail id and a valid mobile number, which will be used to access this portal thereafter.

3.   The enrolment form has a Dashboard with the following 8 tabs to enter the information:

(a)  Business Details with proof of constitution of business to be uploaded, (here the name as per PAN, the PAN, business name as registered with Sales Tax/VAT authorities and the State name shall be auto-populated in the system which will be non-editable)

(b)  Promoters/Partners Information with their photographs to be uploaded, (here promoters may be read as Directors in case of Company form of organisation)

(c)  Authorised Signatories Information (including who shall be the primary authorised signatory), with their appointment proof and photographs to be uploaded,

(d)  Details of Principle place of business (within the State),

(e) Details of additional place of business (within the State),

(f)  Details of top 5 Goods and Services dealing-in with their HSN and SAC coding respectively,

(g)  Details of at least one Bank Account with copy of front page of passbook to be uploaded, and

(f)  Verification of the application by signing and submitting the same.

          The form also provides to save and retrieve the information saved.

4.   There is a facility to upload and update the Digital Signature Certificate (DSC) of the Authorised Signatory, onto the portal.  It is mandatory to sign the enrolment form with DSC by the Company and LLP form of organisation, and for others it is optional.  Others can also sign the enrolment form with e-signature.  E-signature is linked to Aadhaar of the Authorised Signatory, which will generate a One-time password (OTP) on the Aadhaar registered mobile number.  The same has to be used to e-sign the enrolment form.  There is no third way to sign the form.

5.   Once the enrolment form is submitted, an Acknowledgement Receipt Number (ARN) will be generated, the same will be shown under the Migrated status and on the appointed date (i.e. the date on which the GST law shall come into force) the same will be changed to Active status automatically.  Any amendment to the enrolment application can be done only after the appointed date. 

6.   It is possible to submit the enrolment form without signing at this stage, however the same needs to be signed subsequently within 6 months, if not will be cancelled.

7.   On the appointed date a Provisional Enrolment Certificate will be issued.

     

A video based tutorial is provided under the Help tab on the www.gst.gov.in portal which is extremely helpful.  Users must once view the same to have more comfort in filing the GST enrolment form on the portal.

Trust the above information is found useful to the readers. 

Comments, suggestions and improvements are most welcome.

Best Wishes,

Amol Mahajan.

GST in India - An Overview

|| Om Shree Ganeshaya Namah ||

11-11-2016

Dear Readers,

Starting a blog with the title tax-laws, I intend to share my understanding on the subject of tax and other laws, in a very simple language, for the benefit of all.

Goods and Services Tax (GST) is around the corner in India (expected date of implementation being 1^st of April 2017), has created a lot of curiosity coupled with anxiety, not only in the minds of the business community but also the ultimate consumers at large.  GST is a unified consumption tax. Since GST is a uniform tax across the country, tax rate shall not determine the place of doing business in any part of the country.  Also since GST is a destination based or consumption based tax, it will be distributed amongst the states in the proportion of consumption of goods and services. 

Around 150 countries across the globe have GST mechanism, with France being the first country (in 1954) and Malaysia being the latest (in 2015).  USA does not have GST.

Most of the countries have a single tax as GST, however a very few countries like Brazil and Canada has “dual GST”.  India being a Federal country, has adopted ‘dual GST’ mechanism.

The Centre shall collect Central GST (CGST) and the States shall collect State GST (SGST) simultaneously levying it on a common base.  Also, Integrated GST (IGST) would be levied on inter-State supply (including stock transfers) of goods or services and shall be collected by the Centre.  Import of goods or services would be treated as ‘inter-State’ supplies and would be subject to IGST in addition to the applicable customs duties.  Exports would be zero-rated.

Unlike the Excise duty being levied on ‘manufacture’ of goods and Sales Tax/VAT being levied on ‘sale’ of goods and Service Tax is levied on ‘provision’ of services, GST shall be levied on “Supply” of goods and services.

Although India has walked in this direction in 2005, when the Value-Added Tax (VAT) was introduced to replace the Sales Tax regime across the country, a mega-merger of significant indirect taxes is now proposed under GST regime.  Taxes like Central Excise, Countervailing Duty (CVD) and Special Additional Duty (SAD) under the Customs law, Service Tax, Central Sales Tax, Sales Tax or VAT, Purchase Tax, Entry Tax, Entertainment Tax, Luxury Tax, and related Surcharges and Cesses thereto shall be included in the new GST.

GST is likely to apply to all goods and services except for (a) Alcohol for human consumption where State Excise and VAT will be applicable, (b) Electricity where Electricity Duty will be applicable and (c) Sale / purchase of Real Estate where Stamp Duty and Property Taxes will be applicable. GST on five specified petroleum products (Crude, Petrol, Diesel, ATF & Natural gas) would be applicable from a future date to be proposed. Tobacco and tobacco products would be subject to GST, in addition to the Central Excise duty levied by the Central Govt.

Necessary Constitutional amendments have taken place with Presidential assent.  A GST Council has been set by the Union Cabinet with Finance Minister as its Chairperson.  The GST Council shall play a very important role in implementation of GST in India and has a large number of recommendatory powers including tax rates.  The GST Council has recommended the 4 slabs of GST rates being 5%, 12% 18% and 28%.  The Council has also recommended threshold exemption to be fixed at Rs.20 lakhs for all the States except the States specified under Article 279A of the Constitution (North Eastern, Himachal Pradesh, Uttarakhand, J&K) where threshold exemption limit is fixed at Rs.10 lakhs.

The Model GST law is also released by the Ministry of Finance (MoF).  Central Board of Excise and Customs (CBEC) has also released draft rules on Registration, Invoice, Payment, Returns and Refund for public comments.

Goods and Services Tax Network (GSTN), a Public Private Partnership (PPP) Company under section 25 of the Companies Act, 1956 is formed, with Centre and States holding 24.50% shares each and the Financial Institutions (FIs) holding 51%.  GSTN would provide three basic front end services to taxpayers, namely registration, payment and returns.

GSTN is managing the GST Common Portal @ www.gst.gov.in .  Let us understand the migration process of existing registered tax payers to GST regime, in the next paper.

Comments, suggestions and improvements are most welcome.

Best Wishes,

Amol Mahajan.