Interest on delayed GST payment on Net tax liability
The Central Board of Indirect Taxes and Customs (CBIC) clarified on Saturday that the interest on the delay in GST payment will be calculated on the basis of net liabilities. The new laws will be implemented throughout the country after the process of change is complete. That is, traders will have to pay only the late payment on net tax. CBIC has said that amendments have been made in the GST Act in this regard.
The Central Board of Indirect Taxes and Customs (CBIC) said that under GST laws, late payment interest is currently calculated on the basis of gross tax liability. This situation has been stayed by the Telangana High Court by an order dated 18 April 2019.
The CBIC said that after the decision of the Telangana High Court, the Central Government and many state governments are making changes in their CGST and SGST Act based on the recommendations of the GST Council.
The CBIC has recently instructed its regional authorities to start recovering the outstanding interest on late payment of goods and service tax. It is estimated that the interest arrears have reached 46,000 crore rupees. It is noteworthy that recently CBIC had ordered its officials to collect tax on late payment basis from the late GST payers.
In a tweet, The Central Board of Indirect Taxes and Customs (CBIC) said, “At present, GST Acts are exempt to calculate interest on late GST payments based on gross liability”. After this change, the late payment interest will be calculated only on the net tax liability.
The Central Board of Indirect Taxes and Customs (CBIC said that Telangana and West Bengal are in the process of changing their state GST law.