New Delhi, December 25
Traders’ body CAIT on Friday urged Finance Minister Nirmala Sitharaman to defer the implementation of Rule 86B in GST, whereby businesses with over Rs 50 lakh monthly turnover will have to pay at least 1% of their GST liability in cash, terming it a “counter-productive” measure that will increase the traders’ compliance burden.
The Central Board of Indirect Taxes and Customs has introduced Rule 86B in Goods and Services Tax (GST) which restricts use of input tax credit for discharging GST liability to 99%.
However, this restriction will not apply where the managing director or any partner has paid more than Rs 1 lakh as income tax or the registered person has received a refund amount of over Rs 1 lakh in the preceding financial year on account of unutilised input tax credit.
The Confederation of All India Traders (CAIT) in a letter to Sitharaman has drawn her attention towards Section 86B, saying that “it is a counter-productive step which will load the traders further with burden of compliance and also much financial obligation”.
The traders’ body stated that it has “urged Sitharaman to defer implementation of Rule 86 B immediately which is scheduled to be implemented from January 1, 2021 and also extend the last date for filing GST and Income Tax Audit return from December 31 to March 31, 2021”.
CAIT secretary general Praveen Khandelwal said in light of the current scenario when domestic trade is disturbed and traders are fighting for survival of business, it is “strongly urged the implementation of Rule 86 B may be deferred”. — PTI