Taxed, and really taxed: GST Council swamped with complaints by traders

Difficulties faced by traders in registering and filing their GST returns figured strongly at the ongoing Goods and Services Tax (GST) Council meeting in Hyderabad on Saturday, according to a Business Standard (BS) report.

Jammu & Kashmir Finance Minister Haseeb Drabu noted that GSTN clearly has issues. "But these are transitional and some are operational. We will discuss it with the Council," said the BS report quoting Drabu. He said, "I would recommend that we set up a small group of ministers to examine and work out a way forward in 2-3 months."

West Bengal Finance Minister Amit Mitra said that glitches indicated a gap in GST preparedness. "The GST Council would examine issues related to filing of GST returns. Breakdown and technical glitches on the GSTN portal show that GST was implemented in a haste," the BS report quoted Mitra as saying at the meeting.

Issues with GSTN being faced by companies include slow response of the GSTN portal, intermittent accessibility of the portal and errors popping up, the report said.

The deadline for filing GSTR 1, the form for detailed outward supplies, has been extended by five days to September 10. However, issues pertaining to invoice matching, claiming transition credits via the Tran1 form, errors in making final submission, uploading of returns and invoices, among other things, continue to get raised by traders.

Companies have pointed out that in some cases the portal takes a few hours to process their uploaded files. Besides, in cases where invoices containing multiple tax rates are uploaded, the system considers only the item in the last line in offline tool. There are error messages in the case of sales made to Special Economic Zones (SEZ).

Of the 5.95 million who registered for GST in July (excluding those under the composition scheme), only 4.4 million have filed summarised returns or GSTR 3B so far.

However, the GST Council is considering reopening the composition scheme window for smaller players. The scheme, which allows a flat rate of tax and easier compliance, specific to small businesses with annual turnover below Rs 75 lakh, had been closed on August 16. This was after about a million tax assessees had opted for it, the report said.

A senior government official told BS that smaller players have reportedly faced challenges with respect to registration. "Some wanted more time to evaluate their business models to comply with the requirements of the composition scheme. So, we want to give them another chance," he said.