In the Union Budget 2023, the Finance Minister proposed several amendments to the GST Law. The key amendments have been proposed in the provisions regarding filing of GST returns, GST registration, Input tax credit, and decriminalization and compounding of offenses.
The budget for 2023 proposed the following key amendments to the GST Law.
- Restriction in Filing of GST returns beyond three years of due date
Amendments are being made in Sections 37,39,44, and 52 of CGST Act 2017, so as to restrict the filing of returns or statements under these sections beyond three years of its due date.This amendment will restrict the filing of GSTR-1, GSTR-3B, GSTR-8 and GSTR-9 beyond three years from the due date.
- Input tax credit for expenditure related to CSR becomes ineligible
Section 17(5) of the CSGT Act is being amended to provide that ITC shall not be available in respect of goods or services received by a taxable person, which are used for activities related to CSR activities under section 135 of the Companies Act 2013
3.Supplier of Goods through Electronic Commerce Operator will be eligible to opt for Composition Scheme
Amendments are being made in Section 10 which enables the supplier of goods through electronic commerce operators to be eligible for opting the composition scheme subject to the fulfillment of other conditions . Only the supplier of goods is eligible for composition and not the supplier of services.
- Amendment to Schedule III of CGST Act to give retrospective effect
Schedule III of the CGST Act is proposed to amend to give retrospective effect to Paras 7,8(a) and 8(b) which is inserted on 01.02.2019 to keep certain activities such as supplies of goods from a place outside India to another place outside India, high seas sales and supply of warehoused goods before their home clearance outside the purview of GST with effect from 01.07.2017.These activities are neither supply of service not supply of goods with retrospective effect from 01.07.2017. However no refund of tax paid shall be available in case any tax has already been paid in respect of such transactions during the periods 01.07.2017 to 31.01.2019.
- Decriminalization of certain offenses
Section 132 and section 138 of the CGST Act is being amended so as to decriminalize certain offenses specified under clause (g), (j) and (k) of sub-section (1) of section 132 of CGST Act, 2017, viz.-
- i) obstruction or preventing any officer in discharge of his duties
- ii) deliberate tempering of material evidence;
iii) failure to supply the information
Also the amendment made to increase the minimum threshold of tax amount for launching prosecution for the offenses under GST Law from one crore rupees to two crore rupees, except for the offenses related to issuance of invoices without supply of goods or services or both.