Covid lockdown has acted as a double whammy for the already struggling economy and slowing revenues
NEW DELHI: Amid lingering business and economic uncertainty on account coronavirus disease (Covid-19) induced 21-day lockdown, the central board of indirect taxes and customs chairman M. Ajit Kumar softened stance on revenue collections, urging officers to show empathy to taxpayers.
In a letter on Monday, Kumar asked CBIC officers to be sensitive to challenges faced by assesses. “While I have been reminding you every week to keep your focus on revenue, in the current situation, we need to be sensitive to the constraints of taxpayers and treat them with empathy,” he said.
He asked senior officers to provide guidance in this respect. “The days ahead may test our mettle but I am sure our senior officers will be able to provide the leadership and guidance to enable our officers and staff to cope with the challenges.”
Covid lockdown has acted as a double whammy for the already struggling economy and slowing revenues.
The indirect tax target was cut by Rs 1.8 trillion in the revised estimates compared to budget estimates for FY’20, and is expected to see a further scaledown owing to the lockdown.
On Tuesday, finance minister Nirmala Sitharaman extended the last date for GST return filing for March, April, May 2020 to June 30 with no Interest, late fee and penalty for the companies with up to Rs 5 crore turnover and subsidized interest of 9% but no penalty or late fees for bigger companies.
“For larger businesses, relief is largely in form of reduced rate of interest at 9% for delayed payments of GST, which industry may demand to be reduced further,” said Pratik Jain, partner, PwC India. He added that temporary deferral of customs duty payment, time bound disposal of all refund claims in next few days, releasing the GST credits which have been blocked for many large companies in last couple of months and off set of tax dues under one law against tax refund claim against another are few additional measures that Government may want to look at.
Central GST grew by 10.4% in the April to January period and will need to grow by a 21% in the last two months of the fiscal to meet the revised estimate that was scaled down by Rs 1 trillion in the recent budget.
Customs collections shrank by 11% in the April to January period and will need to grow by a whopping 90% in the last two months of the fiscal. The duty was raised on a slew of items in Budget including electronics and household items, but coronavirus has brought most shipments on a halt.
Source- Business Standard.