In an upcoming session, the GST Council is poised to tackle a comprehensive agenda aimed at streamlining compliance and enhancing trade facilitation, particularly for micro, small, and medium enterprises (MSMEs). Central to these discussions is the proposal to amend the GST framework, introducing significant relief measures for sectors such as online gaming, casinos, and horse racing. Key considerations include the potential inclusion of a new Section 11A in the CGST Act, akin to Section 11C of the Central Excise Act, which would enable the government to forgo recovery of excise duty not levied due to prevailing practices. This amendment is anticipated to mitigate the substantial tax burdens currently faced by these industries.
Additionally, the Council will scrutinize the establishment of monetary thresholds for filing appeals before GSTAT, High Courts, and the Supreme Court. Sources suggest that the proposed limits might be set at ₹20 lakh for GSTAT, ₹1 crore for High Courts, and ₹2 crore for the Supreme Court. This aligns with the National Litigation Policy, aiming to curtail government litigation and concentrate legal resources on high-revenue cases and pivotal policy issues.
A significant focus will be on the waiver of interest and penalties for the initial years following the GST implementation. Errors and oversights during the fiscal years 2017-18, 2018-19, and 2019-20, primarily due to unfamiliarity with the new provisions, might be addressed by granting conditional waivers. Taxpayers would be required to settle their full tax liabilities by a notified date, excluding cases involving fraud or willful misstatements, and erroneous refunds. Importantly, already-paid interest and penalties would not be eligible for refunds.
The Council is also expected to deliberate on refund mechanisms for additional IGST paid due to price adjustments post-export. Another notable proposal involves reducing the pre-deposit amounts necessary for filing appeals, potentially lowering the ceiling from ₹50 crore to ₹40 crore for appellate authority cases, and from ₹100 crore to ₹40 crore for appellate tribunal cases. These measures are anticipated to ease the financial burdens on businesses, facilitating a smoother litigation process.
Overall, the GST Council’s forthcoming meeting is set to address crucial compliance and facilitation issues, proposing strategic amendments and relief measures that could significantly impact the operational landscape for MSMEs and specific sectors like online gaming, casinos, and horse racing. The outcome of these deliberations will be pivotal in shaping the future of tax administration and compliance in India.
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