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2017
  • Among the various peculiar provisions in GST, there is a provision called RCM. According to this RCM provision, what will happen if purchases are made from an unregistered person?
  • The provision of reverse charge is already in service tax and the same provision is brought in GST. In service tax there are only specified persons who were required to pay tax on reverse charge basis but in GST all the persons are required to pay tax on the reverse charge on the purchase of goods and services.

What is meant by R.C.M?

  • R.C.M means reverse charge mechanism which means that tax on the purchase of goods or services has to be paid by the recipient. In simpler terms, R.C.M means paying the tax of the other person. Which transaction will be covered in RCM has been specified.

2017
  • In many respects, the Goods and Services Tax (GST) is less a tax reform than a business reform. GST implementation has brought a host of new changes to the taxation regime, but it will also impact the way business is normally conducted. The way goods are returned to a seller will have tax implication.
  • With GST coming into effect, businesses must take stock of how returns could be impacted, especially during the transition phase. The following questions provide a useful framework for understanding the changes to come:
    • What are the tax implications for goods sold prior to GST implementation date (let us call it ‘D-day’) but returned post D-day?
    • What are the tax implications for goods returned from registered and unregistered dealers?
    • What are the tax implications for returned goods that are exempt prior to D-day but taxable post D-day?

2017
  • Indian exporters are worried about the advent of GST and the liquidity crunch it could create for them. The crunch and issues connected to GST administration could adversely affect their overall competitiveness.
  • The Finance Ministry has recently assured exporters that 90 percent of taxes paid will be refunded within seven days. This is certainly good news for exporters. However, given that GST is a new system involving both the central government and states, the speed with which refunds will be issued remains a source of concern.
  • Exports are exempt from many domestic indirect taxes under the current tax regime. This will change once GST kicks in. GST is imposed every time value is added so manufacturing exporters will have to pay GST at various stages, beginning with raw materials. This will likely increase production costs and working capital requirements.

2017
  • Let us have a bird’s eye view for the GST return preparation and due dates for the month of July 2017 and August 2017.
  • There have been widespread concerns over the smooth rollout of GST and there were some glaring concerns from trade and industry. These have led to a decision by the government that for the first two months of the GST implementation, GST would be payable basis a simple return form – Form GSTR-3B. This will contain a summary of outward and inward supplies and you need to submit this before 20thof the succeeding month.

2017
  • The term “profiteering” means making unreasonably high profits in the course of ordinary trade or business. The government of India is committed to protecting consumers from profiteering during the implementation of the Goods and Services Tax (GST) regime. In its efforts to prevent profiteering and ensure the proper levy of GST in India, the government will incorporate an anti-profiteering clause.
  • Since goods and services are taxed at multiple stages of the supply chain, any change in tax structure or tax rates creates an opportunity to improve profit margins at each stage. Thus, the Indian government intends to take measures to ensure that benefits accrued due to the introduction of the indirect tax regime are duly shared with consumers in the form of reduced prices.
  • Under the anti-profiteering clause in GST (Section 163), the central government is authorised to examine whether input tax credits claimed by any registered taxable person result in a “commensurate reduction in the price” of goods and services sold by that person. The central government is authorised to impose penalties in the event such price reductions are not implemented. However, the law is not intended to quash all profits — it’s designed to protect consumers from undue exploitation.

2017
  • As a non-resident Indian have you been grappling with the constant challenge of how various incomes would be taxed in your home country and in India? Are your decisions related to remittances, investments, property purchases and rentals marred at the thought of taxes?
  • Though tax laws in different countries are difficult to fathom, they aren’t as perplexing as you thought. Take for instance the income from abroad. The ground rule is that income which is earned outside India by an NRI is not taxed in India.
  • Similarly, there are a host of other incomes that aren’t taxed in India, but may or may not be touched in the country you are residing in. We present a simple guide for Non-resident Indian to assist them in saving taxes by understanding which income will be exempt and which won’t.

Financial Management