Budget 2022: 12 Significant GST Changes You Need To Know
The Union Finance Minister, Nirmala Sitharaman while presenting the Union Budget 2022 made few important changes in the GST Laws which is noteworthy.
Provision Related to ITC
A new clause (ba) to sub-section (2) of section 16 of the CGST Act is being inserted to provide that input tax credit with respect to a supply can be availed only if such credit has not been restricted in the details communicated to the taxpayer under section 38.
Further, sub-section (4) of section 16 of the CGST Act is being amended so as to provide for an extended time for availment of input tax credit by a registered person in respect of any invoice or debit note pertaining to a financial year upto thirtieth day of November of the following financial year.
Cancellation of GST Registration
Clause (b) and (c) of sub-section (2) of section 29 of the CGST Act are being amended so as to provide that the registration of a person is liable for cancellation, where a person paying tax under section 10 has not furnished the return for a financial year beyond three months from the due date of furnishing of the said return; and a person, other than those paying tax under section 10, has not furnished returns for such continuous tax period as may be prescribed.
Extended time for issuance of credit notes
Sub-section (2) of section 34 of the CGST Act is being amended so as to provide for an extended time for issuance of credit notes in respect of any supply made in a financial year upto thirtieth day of November of the following financial year.
Furnishing details of outward supplies
Section 37 of the CGST Act is being amended so as to provide for prescribing conditions and restrictions for furnishing the details of outward supply and for communication of the details of such outward supplies to concerned recipients; do away with two-way communication process in return filing; provide for an extended time upto thirtieth day of November of the following financial year for rectification of errors in respect of details of outward supplies furnished under sub-section (1); provide for tax period-wise sequential filing of details of outward supplies under sub-section (1).
Manner, conditions, restrictions for communication of details of inward supplies and ITC
Section 38 of the CGST Act is being substituted for prescribing the manner as well as conditions and restrictions for communication of details of inward supplies and input tax credit to the recipient by means of an auto-generated statement and to do away with two-way communication process in return filing.
Provision Related to non-resident taxable person
Section 39 of the CGST Act is being amended so as to provide that the non-resident taxable person shall furnish the return for a month by thirteenth day of the following month; provide an option to the persons furnishing return under proviso to sub-section (1), to pay either the self-assessed tax or an amount that may be prescribed; provide for an extended time upto thirtieth day of November of the following financial year, for rectification of errors in the return furnished under section 39; provide for furnishing of details of outward supplies of a tax period under sub-section (1) of section 37 as a condition for furnishing the return under section 39 for the said tax period.
Claim” of eligible ITC on a “provisional” basis
Section 41 of the CGST Act is being substituted so as to do away with the concept of “claim” of eligible input tax credit on a “provisional” basis and to provide for availment of self- assessed input tax credit subject to such conditions and restrictions as may be prescribed.
Two-way communication process in return filing
Sections 42, 43 and 43A of the CGST Act are being omitted so as to do away with two-way communication process in return filing.
Levy of late fee for delayed filing of return
Section 47 of the CGST Act is being amended so as to provide for levy of late fee for delayed filing of return under section 52. Further, reference to section 38 is being removed consequent to the amendment in section 38 of the CGST Act.
Prescribed restrictions for utilizing the amount available in the electronic credit ledger
Section 49 of the CGST Act is being amended so as to provide for prescribing restrictions for utilizing the amount available in the electronic credit ledger; allow transfer of amount available in electronic cash ledger under the CGST Act of a registered person to the electronic cash ledger under the said Act or the IGST Act of a distinct person
Retrospective effect of levy of interest on input tax credit wrongly availed and utilized
Sub-section (3) of section 50 of the CGST Act is being substituted retrospectively, with effect from the 1st July, 2017, so as to provide for levy of interest on input tax credit wrongly availed and utilized.
Refund claim of any balance in the electronic cash ledger
Section 54 of the CGST Act is being amended so as to explicitly provide that refund claim of any balance in the electronic cash ledger shall be made in such form and manner as may be prescribed; provide the time limit for claiming refund of tax paid on inward supplies of goods or services or both under section 55 as two years from the last day of the quarter in which the said supply was received; extend the scope of withholding of or recovery from refunds in respect of all types of refund; and provide clarity regarding the relevant date for filing refund claim in respect of supplies made to a Special Economic Zone developer or a Special Economic Zone unit by way of insertion of a new sub-clause (ba) in clause (2) of Explanation theret
