GST wilful defaulters punishment mechanism required
GST has been in the limelight for the last 2 years for all right & wrong reasons. However, it is agreeably the most transparent mode of tax. It depends on compliance, trust and accountability from all the assessees in the supply chain. It is a collective effort which will help the Centre to pass on revenue to states in a jiffy and reduces the cost of the product or service.
However, some unscrupulous elements levy GST in their invoices but do not remit the same to the GST authorities. Now the service recipient/buyer trusts or relies on the seller for remitting the GST so that they claim input credit in their monthly/quarterly returns. Therefore it is not the recipient's mistake as the recipient has already paid the GST as per the invoice and he/she should not be penalised.
Now the industry is wasting time following up for compliance of the service provider/seller though it is not their job. The only way to address this issue and nip it in the bud is to evoke penal action immediately and force the seller to comply.
This can be done by introducing a mechanism to point out non-compliance by the seller/supplier in the filing of monthly GST returns by the recipient and blacklisting such sellers/suppliers. Immediate action is necessary as justice delayed is justice denied. more
Our trading community is the most dishonest you can find anywhere. Whatever they were doing earlier with sales tax (hiding tax collected and pocketing the money) continues with GST. Considering the volume of transactions and number of traders involved, no centralised monitoring is possible. Also people use fake invoices to claim credits for GST which was never remitted. A better way may be to make GST online, reduce the % rates and levy it at the origin only. No multi-tier GST, no GST returns by all and sundry, no tax credit, no hassles. All wholesalers must be made to go online for billing and no goods will move anywhere without a centrally numbered bill with QR codes on them. more
Strict Analysis on Returns and Tax, Stringent Corruption Control Policy together with huge punishments is a must more
The new GST returns - Normal, Sugam & Sahaj are applicable from Oct'19 onwards. This mechanism can be provided as such:-
1. At the time of furnishing the monthly/quarterly return, there should be an option to upload the summary of invoices for the GST Input credit availed against each supplier/vendor who has sold the materials/rendered the service to the Recipient and charged GST in the tax invoice. It is imperative that the GST charged by the supplier in his Tax Invoice should be remitted to the GST authorities.
2. Now some suppliers file quarterly returns and the recipient who is following up with the supplier every week for compliance has to wait endlessly and if the supplier misses to include one invoice, then the recipient has to wait for another quarter. Hence to resolve this issue, the filing of Returns should be made MONTHLY for all assessees.
3. Suppliers who default in remitting GST on behalf of the recipient should be classified as wilful defaulters and should be penalised heavily. The summary of invoices data should be taken as the basis and such defaulters should be blacklisted. This will prevent non-compliance by the suppliers. more
Analyzing GST collected AND paid verifying the Returns is a must for vigilant adherence to Tax Realization . more
It is not clear as to how a consumer/customer can be penalised for non-payment of appropriate GST to the government by the seller/supplyer! more
The solution could be for few years there should be more government audits / checks. The auditors should randomly get into any shop anytime of the day stay there for a day or two and check whether the bills are as per norms. And if required government should hire contract employees for this task, till it becomes more stabilized. more
Already two have passed and still non compliance of GST implementation should be taken seriously. more