GST: old habits spur poor compliance:

GST: old habits spur poor compliance:

Context

• The government had last week announced that, though the last date for filing the GSTR-3B form for August was September 20, only 55% of those ‘required to file’ had done so by September 25.

What are the reasons behind half of the registered taxpayers filing their August returns?

• It could be due to a combination of behavioural reasons, and the clashing of various deadlines.
• It could also be that the taxpayers are waiting to first deal with the more complicated GSTR-1 form and then turn to the GSTR-3B.
• It appears that 45% of the assessees have still not filed returns.

What should be done?

• The Government should go to the root cause and analyse whether these assessees are facing some genuine problems or they have been migrated automatically and are not required to comply.
• Many small vendors have had to register themselves on the GST Network in order to obtain a GST number, something their buyers need them to have for the purpose of availing input tax credits. However, once registered, these small businesses have to file their returns regularly.

Issue of Zero returns

• All the people who have taken up a GST registration have to file their returns, even if it is a zero return.