On global landscape, the World economic output may exceed 100 trillion for first time in 2022, as per prediction of British Consultancy Cebr. India may overtake France in 2022, and Britain in 2023 to regain its place on the World’s sixth biggest economy. Major economics will have to cope up with inflation also.
The news from core sector is not good as the growth had slowed down in November, 2021 in almost all the sectors. The World Bank and Moody’s have projected the Indian economy to grow @ 8.3% and 9.3% respectively.
Economists of the country have voiced that any sharp fiscal correction should be avoided and focus should be on public investment in infrastructure to boost consumption and demand besides striving for consistency and stability in tax policies. According to RBI’s Financial Stability report, there appears to be a disconnect between the real economy and equity market.
States have asked from the Union Government that centre should increase its share of expenditure in centrally sponsored schemes, make higher borrowing limits for states unconditional, give direct income support in certain sectors etc. States have also demanded for further extension of compensation cess for five yea₹ 2027. The FM is in the process of holding pre-budget talks with State Finance Ministers.
Despite excise duty cuts on petrol and diesel in November, gross tax revenue grew 18.2 percent in November and 50.3 percent in the April-November period. Net tax collection in November, however, declined by 18.6 percent due to a doubling of the states share in central taxes to ₹ 95,082 crore during the month.
The 46th GST Council meeting was held in Delhi on 31st December 2021, the last day of the year to decide on GST rates on textile, footwear, besides other issues as lot of changes were in line to be enforced from 1 January, 2022. The new GST rate structure for textiles stands deferred from the time being, though, it decided to go ahead with the changes announced for footwear sector.
GST collection the gross GST revenue collected in the month of December 2021 is ₹ 1,29,780 crore of which CGST is ₹ 22,578 crore, SGST is ₹ 28,658 crore, IGST is ₹ 69,155 crore (including ₹ 37,527 crore collected on import of goods) and cess is ₹ 9,389 crore (including ₹ 614 crore collected on import of goods). The revenues for the month of December 2021 are 13% higher than the GST revenues in the same month last year and 26% higher than the GST revenues in December 2019. During the month, revenues from import of goods was 36% higher and the revenues from domestic transaction (including import of services) are 5% higher than the revenues from these sources during the same month last year.
Lot of changes have been notified in GST rules and amendments made by Finance Act, 2021, both of which come into force w.e.f. 1st January, 2022.
Recommendations of 46th GST Council Meeting
Existing GST rates in textile sector to continue beyond 1st January, 2022
(Source: PIB Release ID: 1786581 dated 31.12.2021)
Notified date for certain amended CGST rules
CBIC has notified 01.01.2022 as the effective date for the following amendments made in CGST Rules, 2017 vide Notification No. 35/2021-CT dated 24.09.2021:
- Rule 10B : Aadhaar authentication for registered persons
- Rule 23 : Revocation of cancellation of registration; Sub-rule (1) made subject to Rule 10B
- Rule 89 : Application for refund of tax, interest etc; Sub-rule (1) made subject to Rule 10B.
- Rule 96 : Refund of integrated tax paid on goods or services exported out of India;
Sub-rule (1) to have Aadhaar authentication
(Source: Notification No. 38/2021-CT dated 21.12.2021)
Effective date of GST amendments made by Finance Act, 2021
CBIC has notified 01.01.2022 as the notified date for enforcement of the following amendments made in the CGST Act, 2017 by the Finance Act, 2021:
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Section of Finance Act, 2021
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CGST Act, 2017
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Relating to
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|
108
|
7
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Supply – members / association
|
|
109
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16
|
ITC – invoice / debit note
|
|
113
|
74
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Adjudication in cases of fraud etc
|
|
114
|
75
|
Determination of tax
|
|
115
|
83
|
Provisional attachment
|
|
116
|
107
|
Appeal against penalty – 25% to be paid
|
|
117
|
129
|
Detention & seizure of goods
|
|
118
|
130
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Confiscation of goods & conveyance, penalty
|
|
119
|
151
|
Power to call for information
|
|
120
|
152
|
Ban on disclosure of information
|
|
121
|
168
|
Power to issue instructions / directions
|
|
122
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Sch-II
|
Supply of goods by incorporated association omitted w.r.e.f. 01.07.2017.
|
(Source: Notification No. 39/2021-CT dated 21.12.2021)
Amendments in CGST Rules
Due date for Form 9 / 9C extended
- The due date of furnishing annual return (Form GSTR-9) and self certified reconciliation statement (Form GSTR-9C) for the financial year 2020-21 was 31.12.2021.
- The same have been extended from 31.12.2021 by two months to 28.02.2022.
- Necessary amendments have been made in Rule 80 of CGST Rules, 2017 by inserting new Rules 1A and 3A w.e.f. 29.12.2021.
Documentary requirement for clamming ITC
- Rule 36 of CGST Rules, 2017 deals with requirements and conditions for clamming input tax credit
- Sub-rule (4) has once again been substituted w.e.f. 01.01.2022
- Accordingly, following rule will prevail w.e.f. 01.01.2022.
No input tax credit shall be availed by a registered person in respect of invoices or debit notes the details of which are required to be furnished under sub-section (1) of section 37 unless,-
(a) the details of such invoices or debit notes have been furnished by the supplier in the statement of outward supplies in FORM GSTR-1 or using the invoice furnishing facility; and
(b) the details of such invoices or debit notes have been communicated to the registered person in FORM GSTR-2B rule 60 (7) for inward supplies.
Other changes in CGST Rules, 2017
- Tax refund to specified united nations / international organization (Rule 95 w.e.f. 01.04.2021)
- In cases where Unique Identity Number of the applicant is not mentioned in a tax invoice, the refund of tax paid by the applicant on such invoice will be available only if the copy of the invoice, duly attested by the authorized representative of the applicant, is submitted along with the refund application.
- Recovery of penalty from sale of goods / conveyance detained or seized in transit (Rule 144A w.e.f. 01.01.2022)
- Where the person transporting any goods /owner of such goods fails to pay the amount of penalty under Section 129(1) within fifteen days from the date of receipt of the copy of the order passed, the proper officer shall proceed for sale or disposal of the goods or conveyance so detained.
- Such goods or conveyance shall be sold through a process of auction.
- If an appeal has been filed, the proceedings for recovery of penalty by sale of goods or conveyance detained or seized in transit under this rule shall be deemed to be stayed.
- Provisional attachment (Rule 159 w.e.f. 01.01.2022)
- If any property of a person has been attached under GST laws, the tax department will arrange to send such order copy to such person.
- A new form in GST DRC-22A has been added in GST rules whereby within seven days of the attachment, such person can file an objection to the department against attachment.
(Source: Notification No. 40/2021-Central Tax dated 29.12.2021)
Changes in Compensation Cess
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S.No.
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New Heading / Tariff
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Goods
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25
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2403 91 00
or 2404 11 00
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“Homogenised” or “reconstituted” tobacco, bearing a brand name
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37
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2403 99 90
or 2404 11 00
or 2404 19 00
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All goods, other than pan masala containing tobacco 'gutkha', bearing a brand name
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38
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2403 99 00
or 2404 11 00
or 2404 19 00
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All goods, other than pan masala containing tobacco 'gutkha', not bearing a brand name
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54
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8802
or 8806
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Other aircraft (for example, helicopters, aeroplanes), for personal use.
|
- The amendment will come into force w.e.f. 01.01.2022.
- Necessary Notifications have also been issue under Customs Act, 1962 to align HSN Codes.
(Source: Notification No. 2/2021-Compensation Cess (Rate) dated 28.12.2021)
Changes in rate of GST / goods specified in different schedules
- Notification No. 1/2017-CT (Rate) dated 28.06.2021 specifies the different GST rates in Schedule I to VI
- Various changes have been made in chapter heading / sub-heading / Tariff Item in Schedules I, II, III and IV (for details, reference can be made to notification)
- These changes are effective from 01.01.2021.
(Source: Notification No. 18/2021-Central Tax (Rate) dated 28.12.2021)
Changes in exemption from GST on various goods
- Notification No. 2/2017-CT (Rate) dated 28.06.2017 exempts levy of GST on certain specified items.
- Changes in exemption have been made in S.Nos 22, 43B, 49, 97A (new), 101 and 141.
- At S.No. 49 (Code 0802), the new description of goods shall be “Other nuts, fresh such as Almonds, Hazelnuts or filberts (Corylus spp.), walnuts, Chestnuts (Castanea spp.), Pistachios, Macadamia nuts, Kola nuts (Cola spp.), Areca nuts, Pine nuts, fresh, whether or not shelled or peeled” .
- At S.No. 97A (Code 2009 89 90) , new entry is:
Tender coconut water other than those put up in unit container and -
- bearing a registered brand name; or
- bearing a brand name on which an actionable claim or enforceable right in a court of law is available [other than those where any such actionable claim or enforceable right in respect of such brand name has been voluntarily foregone, subject to the conditions.
- This shall be effective from 01.01.2022
(Source: Notification No. 19/2021-Central Tax (Rate) dated 28.12.2021)
Exemption to Intra-state supplies of handicraft goods
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S.No.
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New Heading / Tariff
|
Goods
|
|
4
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4414
(Old 4414 00 00)
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Wooden frames for painting, photographs, mirrors etc
|
|
29
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7419 80
(old 7419 99)
|
Art ware of brass, copper / copper alloys, electro plated with nickel silver
|
- This shall come into effect from 01.01.2022.
(Source: Notification No. 20/2021-Central Tax (Rate) dated 28.12.2021)
Change of tax on footwear
Entry- 171 A 1
Heading- 64
Goods- Foot wear of sale value not exceeding ₹ 1000 per pair
- Thus, GST rate shall be 12% (6% CGST, 6% SGST) on all footwear having a sale value not exceeding ₹ 1000 (i.e., upto ₹ 1000) per pair
- This shall be effective w.e.f. 01.01.2022.
(Source: Notification No. 21/2021-CT (Rate) dated 31.12.2021)
Refund filing mechanism for taxpayer of erstwhile UT of Daman & Diu
- CBIC has clarified on mechanism / procedure for filing of refund claim by taxpayers registered in erstwhile Union Territory of Daman & Diu for the period prior to its merger with UT of Dadra & Nagar Haveli (w.e.f. 01.08.2020)
- If has been clarified that :
- Refund application to be filed under ‘any other’ category on GST portal with new GSTIN.
- ‘Remarks’ column to indicate usual category.
- Application to be accompanied by documents which are required to be submitted with refund claim.
- Applicant not required to make any debit from electronic credit ledger at application stage.
- If the proper officer is satisfied about refund eligibility, he will request the applicant to debit the said amount from electronic credit ledger through Form GST DRC-3
- On confirming, refund will be issued in Form GST RFD -06 and payment order in Form GST RFD -05.
- No refund claim, requiring debit from the electronic credit ledger or where the refund would result in re-credit of the amount sanctioned in the electronic credit ledger, shall be filed using old GSTIN.
(Source: Circular No. 168/24/2021-GST dated 30.12.2021)
Implementation of Rule-59(6), of CGST Rules, 2017
(Source: GSTN dated 03.01.2022)
GST collection for December, 2021
- The gross GST revenue collected in the month of December 2021 is ₹ 1,29,780 crore of which CGST is ₹ 22,578 crore, SGST is ₹ 28,658 crore, IGST is ₹ 69,155 crore (including ₹ 37,527 crore collected on import of goods) and cess is ₹ 9,389 crore (including ₹ 614 crore collected on import of goods).
- The revenues for the month of December 2021 are 13% higher than the GST revenues in the same month last year and 26% higher than the GST revenues in December 2019. During the month, revenues from import of goods was 36% higher and the revenues from domestic transaction (including import of services) are 5% higher than the revenues from these sources during the same month last year.
- The GST collection in the month is close to ₹ 1.30 lakh crore despite reduction of 17% in the number of e-way bills generated in the month of November, 2021 (6.1 crore) as compared to the month of October, 2021 (7.4 crore) due to improved tax compliance and better tax administration by both Central and State Tax authorities.
(Source: Ministry of Finance Press Release ID: 1786774 dated 01.01.2022)
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