December 4, 2021

Finance Ministry Clarification on Mandatory Payment of One Percent Gst Liability – Section 86-B of GST in disputes, Finance Ministry clarifies after protests


Business Desk, Amar Ujala, New Delhi
Updated Sat, 26 Dec 2020 04:31 PM IST

Nirmala Sitharaman (File photo)
– Photo: PTI

Read Amar Ujala e-paper
anywhere anytime.

*Yearly subscription for just ₹299 Limited Period Offer. HURRY UP!

Hear the news

Controversy has arisen over the addition of Section 86-B to the GST rules by the government. Recently, the Confederation of All India Traders (CAT), a trade association, wrote a letter to Union Finance Minister Nirmala Sitharaman opposing the addition of Section 86-B to the GST rules. Now the Finance Ministry has been issued an explanation in this regard.

The ministry has said that less than one percent taxpayers will be affected by this rule. Under this rule, it is mandatory for every trader (whose monthly turnover is more than Rs 50 lakh) to deposit one percent GST in cash. This change was made by the central government to curb tax evasion through fake bills, which traders are opposing.

Only 45,000 taxpayers will be affected
A senior ministry official said that this rule will be applicable where there is more risk to the revenue. Only 45,000 taxpayers will be affected by this rule, which is just 0.37 percent of the 1.2 crore tax base. This rule will not affect any honest dealer or businessman.

Traders demand from Finance Minister
The Finance Ministry had in a notification on 22 December informed about adding Rule 86B to the GST rules. CAT had demanded in a letter to Finance Minister Nirmala Sitharaman that this rule be withdrawn immediately and implemented only after consulting the traders. Along with this, CAT has also demanded that the deadline for filing returns of audit in GST and Income Tax be extended for three months from 31 December 2020.

Controversy has arisen over the addition of Section 86-B to the GST rules by the government. Recently, the Confederation of All India Traders (CAT), a trade association, wrote a letter to Union Finance Minister Nirmala Sitharaman opposing the addition of Section 86-B to the GST rules. Now the Finance Ministry has been issued an explanation in this regard.

The ministry has said that less than one percent taxpayers will be affected by this rule. Under this rule, it is mandatory for every trader (whose monthly turnover is more than Rs 50 lakh) to deposit one percent GST in cash. This change was made by the central government to curb tax evasion through fake bills, which traders are opposing.

Only 45,000 taxpayers will be affected

A senior ministry official said that this rule will be applicable where there is more risk to the revenue. Only 45,000 taxpayers will be affected by this rule, which is just 0.37 percent of the 1.2 crore tax base. This rule will not affect any honest dealer or businessman.

Traders demand from Finance Minister
The Finance Ministry had in a notification on 22 December informed about adding Rule 86B to the GST rules. CAT had demanded in a letter to Finance Minister Nirmala Sitharaman that this rule be withdrawn immediately and implemented only after consulting the traders. Along with this, CAT has also demanded that the deadline for filing returns of audit in GST and Income Tax be extended for three months from 31 December 2020.


www.amarujala.com

Leave a Reply

Your email address will not be published. Required fields are marked *