Govt may up GST return discrepancy threshold for notices, says source
NEW DELHI - In a bid to streamline the flurry of automated goods and services tax notices for discrepancies in companies' returns from the amount due as per the system, the government is considering raising the threshold for such demands to 15-20% from 5%, a senior finance ministry official said. The move will alleviate the stress on the tax administration, litigation, and the companies concerned as it will sharply bring down the number of notices, experts said.
"Currently, notices are being sent whenever there is a 5% difference between a company's GST return filing and the system's automated results. Raising this 5% to 15-20% will only flag cases with that much difference between the two," the official told Informist. This is still being discussed, and the government is yet to take a final decision, the official added.
In the last seven to eight months, state and central GST authorities have issued a flurry of notices to some of the biggest public and private sector companies, including Life Insurance Corp of India, Maruti Suzuki India, ICICI Bank, Hindustan Unilever, UltraTech Cement, and Bharti Airtel.
"Accepting a tolerance limit on mismatches and accordingly issuing notices only on breach of mismatch threshold would go a long way in fostering ease of doing business and limiting unwarranted litigation," said Indirect Tax Head and Partner at KPMG Abhishek Jain. This will bring a major relief to small companies and help the government streamline who the big fish are to go for, as it will filter out small offenders, said Bimal Jain, tax expert at A2Z Taxcorp.
