Andhra Pradesh Builders are paying 12 percent; vow they will not privilege Input Tax Credit.
RAJAHMUNDRY: Andhra Pradesh builders have commanded that the Centre should let them gain Composition Scheme with stable GST of five percent on flat and land cost. They asserted that they will not claim the Input Tax Credit so that it aids to bring down the cost of every housing project and also enables good relationship amid builders and clients in the state.
Presently, as per GST standards, the builders are paying GST of 12 percent on the entire cost of a housing project containing the cost of flat and land and they are enabled to get back Input Tax Credit of around 4.5 percent through the government claims that it is around 6.5 percent. The Centre has presented Composition Scheme below GST to aid small and medium companies and startups. Tax compliance dealings have been simplified in this system as this category of entrepreneurs might not have necessary resources and expertise, the government feels.
The Composition Scheme aids taxpayers to file their summarized returns on a quarterly base not like the present system of filing tax returns three times in a month.
Businesses commerce with goods can only benefit Composition Scheme and those dealing with services cannot do so excluding for restaurants. If a producer of goods aims to avail Composition Scheme, he or she has to pay GST rate of two percent counting one percent each of State GST and Central GST. Likewise, a food dealer has to pay GST rate of five percent including 2.5 percent each of SGST and CGST.
Those who choose for Composition Scheme are not permitted to avail Input Tax Credit.
Yet there is no provision for service providers to benefit Composition Scheme at present, as the GST Council has been holding a sequence of meetings to revise the GST to garb the needs of the individuals, the state builders allied with Confederation of Real Estate Developers’ Associations of India, are requesting the Centre to let them to opt for Composition Scheme by fixing GST of five percent from the present 12 percent on every housing project.
The experts are saying that builders are paying 12 percent GST and claiming for around 6.5 percent Input Tax Credit, which means that they are in paying only 5.5 percent of GST and even that they want to be lessened to only five percent officially for every housing project. But if they gain Composition Scheme, they are not enabled to claim ITC, state the authorities.
Taxpayers fail to file returns due to technical glitches
GST payers are finding it a hard task to file their tax returns as per agenda following technical bugs in the maintenance of servers in the state. Since the GST came into force from July 1st, taxpayers have been enquired to file their tax returns 3 times in a month based upon the nature of trade and volume of business. Originally, the officials excused themselves claiming teething glitches. But even though more than 3 months have passed, there is no reprieve to those who expect to file their returns.
Just, the government had fixed October 5 as the prolonged deadline for those who have to file their returns for August but even that has also botched as taxpayers have botched to file their returns because of technical snags. Currently, the government has removed the deadline.
The GST payers have to pay returns three times in a month in the forms of GST R1, GST R2, and GST R 3B. For example, in GST R1 pertaining to the construction industry, the sale of hardware materials to builders, the sale of flats by builders by hardware dealers will be filed. Beneath GST R 2, details of sales and purchases by numerous dealers will be handy and both the sellers and purchasers have to get their bills matched. If any differences are found under GST R3B, total accountability and input tax credit will be stuck and the builder has to pay rest of the amount as GST.
Builders express that they are getting puzzled over the complex process in filing their returns and also getting preoccupied with such work that includes too many procedures instead of concentrating on the implementation of their housing projects.