INSUBCONTINENT EXCLUSIVE:
Presently, restaurants registered under GST are collecting and depositing the taxNew Delhi: Food aggregators like Swiggy and Zomato will
have to collect and deposit tax at five per cent rate beginning Saturday, a move which will widen the tax base as food vendors who are
currently outside the GST threshold will become liable to GST when provided through these online platforms.Currently, restaurants registered
under GST are collecting and depositing the tax
vehicles effective January 1
Also, footwear irrespective of prices will attract 12 per cent tax from Saturday.These are among the many changes in the GST regime that
have come into effect in this new year 2022
Also to tackle evasion, the GST law has been amended to state that the input tax credit will now be available only once the credit is
appearing in GSTR 2B (purchase return) of the tax payer
Five per cent provisional credit, earlier allowed in GST rules, will not be permitted post January 1, 2022.EY India Tax Partner Bipin Sapra
said, "this change will have an immediate impact on working capital of tax payers who are currently availing credit of 105 per cent of
The change will also mandate industry to validate that the procurements are made from genuine and compliant vendors."The other anti-evasion
measures which would come into effect from the new year include mandatory Aadhaar authentication for claiming GST refund, blocking of the
facility of GSTR-1 filing in cases where the business has not paid taxes and filed GSTR-3B in the immediate previous month.Currently, the
law restricts filing of return for outward supplies or GSTR-1 in case a business fails to file GSTR-3B of preceding two months.While
businesses file GSTR-1 of a particular month by the 11th day of the subsequent month, GSTR-3B, through which businesses pay taxes, is filed
in a staggered manner between 20th-24th day of the succeeding month.Also, the GST law has been amended to allow GST officers to visit
premises to recover tax dues without any prior show-cause notice, in cases where taxes paid in GSTR-3B is lower based on suppressed sales
volume, as compared to supply details given in GSTR-1.Sapra said while the amendment is likely to curb the malpractice of passing of input
tax credit through declaring in GSTR-1 without paying taxes in GSTR 3B, genuine differences in GSTR-1 and GSTR 3B like carry forward of
unadjusted credit notes are likely to face unnecessary scrutiny.The move is intended to curb the menace of fake billing whereby sellers
would show higher sales in GSTR-1 to enable purchasers to claim input tax credit (ITC), but report suppressed sales in GSTR-3B to lower GST
liability.Nexdigm Executive Director (Indirect Tax) Saket Patawari said e-commerce operators are now liable to pay GST in place of the
restaurants and the tax base of government may increase due to above as these operator will be liable to GST even for unregistered
restaurants."E-com operators may be asked to obtain registration in each State where restaurants are located even if they don't have
presence and undertake all the regular GST compliances even if they don't have any infrastructure in the State
It may become a challenge to handle audits and investigations in all the states esp
for start ups and new E-com operators," Patawari added.Sapra further said that this amendment will also widen the tax base as food vendors
who are currently outside the GST threshold will become liable to GST when provided through these online platforms
Thus, making procurement from these platforms more costlier."Given that restaurants sometimes supply goods along with restaurant services,
an invoice may have multiple payments by multiple people and hence would involve complexity of operations
This practice of laying burden on E-Commerce operators for supplies made through them is putting additional burden on a platform which is
just facilitating the supply," Sapra added.
