Defer rollout of GST rule 86B, Requests Confederation of All India Traders

Defer rollout of GST rule 86B, Requests Confederation of All India Traders As per GST rule 86B businesses with over Rs. 50 Lakh monthly turnover should at least pay 1% of their GST liability in cash. Traders body, Confederation of All India Traders [CAIT] has requested the hon'ble FM to defer the rollout of GST rule 86B.  As per the body, the reason that the rollout should be deferred is that this rule will increase the compliance burden on traders. As per GST Notification number, 94/2020-Central Tax dated 22nd Dec 2020, GST rule 86B has been introduced which has imposed 99% restricted on ITC (Input Tax Credit) available in electronic credit ledger of Registered Person. This means 1% of Output liability to be paid in cash. The main intention of the government for introducing rule 86B is to curb the practice of fake invoicing. This limitation of 99% ITC is applicable where the value of taxable supply other than exempt supply and zero-rated supply, in a month, exceeds fifty lakh rupees. The restriction shall not apply in the following cases:

• The Taxpayer has paid Income Tax exceeding ₹1 lakh in two preceding financial years.
• The Taxpayer has received a refund under Section 54 exceeding ₹1 lakh in the preceding financial year.
• The Taxpayer has paid outward tax liability in cash which cumulatively exceeds 1 per cent of total tax liability for the financial year till date. The restrictions shall not apply to the following categories of taxable person:
  • Government department,
  • Public Sector undertaking,
  • Local authority,
  • Statutory body

As per the CBIC [Central Board of Indirect Taxes & Customs] notification, the rule is applicable w.e.f. 1st January 2021. The body has also urged FM to extend due dates for filing GST & Tax Audit for FY 2019-20 to 31st March 2021. As of now the due date stands to be 31st Decemeber 2020. Tags: GST https://www.youtube.com/watch?v=L19KKChAhs8&t=29s