Tax filing process still complicated, penalty for late filing adding burden on the MSMEs: IIA

New Delhi, Oct 24 (KNN) With news reports surfacing that the Goods and Services Tax (GST) Council likely to reduce the penalty on late filing of GST returns in its next meeting on 10 November in Guwahati, the tax department’s proposal of decreasing the penalty if accepted will bring relief to the Micro, Small and Medium Enterprises (MSMEs), Indian Industries Association said.

Talking to KNN, Sunil Vaish, President of Indian Industries Association (IIA) explained the situation.

He said that the taxpayers are new to the process of online tax filling. This filling process is very complex and the penalty for late filling is very high which sometimes exceeds the tax liability due to which MSMEs suffer.

Vaish explained that the MSME sector is facing tax refund issues and Internet connectivity problems. Also and the technical glitches on the GST portal is another thing that is proving to be a hurdle for the sector that is still grappling under the One Nation One Tax regime of the government.

At present late fee of Rs100 each, under Central GST (CGST) and State GST (SGST) or Rs200 per day is levied along with 18 percent interest per-annum.

He further said that the whole filling process should be simplified and should be available both offline and online. Also the penalty must be deferred till 6-8 months so that the MSMEs could understand the tax filling process.

Responding to the news reports hinting towards reduction in the penalty that is being imposed, Vaish said MSMEs are hopeful that the next GST council meeting is going to be fruitful for the sector. The industry is expecting that penalty burden will reduce.

Earlier, government waived the late fee of Rs200 per day for those who could not meet the deadline of filling first GST for the month of July. (KNN/AG)