Finance secretary Hasmukh Adhia, while talking at CNBC TV18’s event GST Decoded, said the government is coming up with a mechanism to identify wrong input tax credit claims.
Finance secretary, Hasmukh Adhia, while talking at CNBC-TV18’s event GST Decoded marking the completion of one year of GST said, “Everybody knows the figure for the amount of tax we collect, if that is say one lakh crore, the amount of tax liability that is generated every month is five lakh crore. Four lakh crore is input credit claimed.”
The Goods and Services Tax (GST) regime is scheduled to complete a year on July 1, 2018. GST collection for the month of April reached Rs 1,03,458 crore.
The secretary also talked about the Centre’s plan to come up with a new GSTR form starting 1 January, 2019. The finance ministry is also looking to launch a pilot for the same in October this year.
The secretary also said natural gas and jet fuel (ATF) are ‘natural’ and ‘easier’ candidates for inclusion in the indirect tax regime. Adhia said the call for including the two in GST would be taken up the regime’s highest decision making body GST Council.
He, however, did not say if it would be on the agenda for the next GST Council meeting on 21 July.
Since its launch on 1 July last year, the government has cut tax rates on a slew of goods and services as well as simplified rules in an attempt to rationalise the regime that reshaped India’s industrial landscape as it widened the country’s tiny tax base, removed myriad middlemen, vanquished border checkposts, freed up internal trade and made it easier to do business.
But, the challenge has been to bring cash cows crude oil, natural gas, petrol, diesel and ATF under GST. Oil yielded maximum revenue for both the central and state governments, and none seemed to want to let go of it.
While prevailing tax rate, made up of central excise duty and state VAT on petrol and diesel, is way beyond the 28 percent peak tax rate under GST, tax incidence on natural gas and ATF is low enough to get fitted into one of the 5, 12, 18 and 28 percent GST tax bracket.
“We are conscious that there are certain items which are not part of GST. As and when there is a discussion on these items in the GST Council, the Council will take a call on it,” Adhia said.
Asked whether discussions could start with natural gas and ATF, Adhia said: “Depends on what GST Council wants to discuss. But yes, among the 5 items, the two natural candidates for first level of discussion would be natural gas and aviation turbine fuel. GST Council can decide what it wants to discuss, but these two are easier”.