Ministry of Finance to Introduce GST Amnesty Scheme
Recent reports suggest that the Ministry of Finance is set to release a circular outlining the highly anticipated goods and services tax (GST) Amnesty Scheme, following its proposal in the Budget 2024. This scheme is designed to offer relief to taxpayers by waiving interest and penalties under specific conditions for tax matters that arose between July 1, 2017, and March 31, 2020.
The scope of the scheme encompasses show cause notices (SCNs), adjudicating orders, and appeal orders issued during the financial years 2017-18, 2018-19, and 2019-20. Sources reveal that under this initiative, taxpayers can benefit from an exemption of interest and penalties if they settle the full tax amount by March 31, 2025. It’s important to note, however, that cases related to refunds are explicitly excluded from the scheme. Furthermore, taxpayers currently engaged in appeals or court proceedings must retract these cases to be eligible for amnesty. Once a case is resolved under the scheme, it becomes non-appealable.
The scheme’s implementation is anticipated to commence around October or November 2024, subsequent to the issuance of the official notification. Additionally, there is ongoing advocacy within the industry for the inclusion of cases with demands solely for interest or penalties, as well as transitional credit disputes under the scheme.
Moreover, it is highlighted that the scheme operates on a show cause notice or order-wise basis, requiring taxpayers to address all issues pertaining to a specific show cause notice or order when opting for participation.
Representatives have raised several key points for consideration. They emphasize the significance of including cases where only interest and/or penalty payments are pending, and the provision for separating the fiscal years 2017-18 to 2019-20 from the show cause notice/order for which amnesty can be availed. Additionally, there are proposals advocating for the utilization of Input Tax Credit (ITC) Ledger for making tax payments under the Scheme.
Vivek Jalan, Partner at Tax Connect Advisory Services LLP, a PAN India Multidisciplinary Firm, expressed the need for provisions to address disputes regarding the time barring period of Input Tax Credit under the CGST Act.
As the anticipation builds, stakeholders eagerly await the official circular from the Ministry of Finance, heralding the commencement of the GST Amnesty Scheme and the prospective relief it is poised to offer.
