Tag Archives: GST

The Ministry of Finance announced December 27, 2017 as the late date for filing the TRAN-1 form under the Goods and Services Tax (GST) to avail input tax credit. The Ministry, in a release, informed that a taxpayer could file Form TRAN-1 and avail input tax credit on the basis of closing balance of the input tax credit declared in the last return under the pre GST regime. In keeping with the philosophy of voluntary compliance, revision of Form TRAN-1 has also been provided. The last date for revision of TRAN-1 is also December 27. The Ministry noted that some taxpayers have availed extraordinarily high transitional credit of CGST. Such behaviour leads to breach of trust between the taxpayer and the tax-administration, the release said. Taxpayers who have claimed transitional credit erroneously are advised to avail of the opportunity to revise Form TRAN-1 within the deadline, failing which the tax administration would be constrained to initiate audit and enforcement action against the identified units, the release mentioned.

The upcoming wedding season starting in November may be impacted by 10-15 per cent, particularly wedding services like marriage garden/marriage hall booking, tent booking, confectionery services, photography and more, reveals industry chamber ASSOCHAM. The GST rate on most of these services has risen from 18 to 28 per cent. Destination wedding or the wedding tourism sector in India which accounts for less than 10 per cent share in the overall industry is not likely to face much adverse impact of GST and demonetisation as it is already a costly affair which mainly lures foreigners, NRIs, rich and famous people for weddings at beaches and royal palaces, says the ASSOCHAM paper. All footwear above Rs.500 is taxed at a whopping 18 per cent. Tax on gold and diamond jewellery has increased from 1.6 per cent to 3 per cent. The booking for a five-star hotel will cost 28 per cent extra in the form of GST. Also, event management service, will have to pay an additional 18 per cent GST on the cost. GST on marriage garden and hall booking is also 18 per cent, same as most other wedding services.

Travel agents providing online ticketing and other services will be liable to deduct one per cent tax at source under the GST regime as they have been classified as e-commerce operators, the CBEC said. Under the Goods and Services Tax (GST) regime, an e- commerce operator is required to collect 1 per cent of the net value of taxable supplies made through it. The amount so collected is called tax collected at source or TCS but this provision has been kept in abeyance for the time being. Online travel agents have been classified as e-commerce operators (ECO) and so they have to deduct TCS. The Central Board of Excise and Customs (CBEC), in a fresh set of frequently asked questions (FAQs), said the TCS requirement would not apply to someone selling own products through a website. Only applicable GST for the goods would be levied in that case. Electronic commerce or e-commerce means supply of goods or services, including digital products, over elect .. electronic network and an e-commerce operator is a person who owns operates or manages the electronic platform for e-commerce, it said. “Online travel agents providing services through digital or electronic platform will fall under the category of ECO (e- commerce operator) liable to deduct TCS under Section 52 of the CGST Act, 2017,” the CBEC said.

The Maharashtra Chapter of the IATA Agents Association of India (IAAI) recently conducted its Annual General Meeting in Mumbai. The AGM unequivocally declared that the present day maladies being faced by the travel agents fraternity were set off by the downfall of the national carrier that started in 2004 and was eventually hastened from end-2008 when Air India implemented zero commission (within India) to please the Star Alliance Group. Biji Eapen, National President, IAAI, said, “The AGM has unanimously decided to demand five per cent commission on gross fare and in turn, the entire travel agent community will wholeheartedly support Air India to regain its name and brand. The AGM collectively looks forward to Air India reversing its anti-travel agent policies and becoming a role model. Air India can only ensure the operation of a flight from one airport to another. But the aircraft seats have to be filled by the traditional travel agents only, as Air India’s web sale volume is marginal. Under the new GST regime, agents can survive only with the commissions as mandated by IATA Resolution 824 (Para 9) and the DGCA Order of March 5, 2010. It will be suicidal to depend on service charges as it may have to be separately invoiced.”

The second leg of Global Panorama Showcase (GPS) opened in Ahmedabad to an overwhelming response on day one. The first day began with product presentations by exhibitors and received 600 plus attendees. The product presentations were followed by the much-awaited session on GST by team GMJ & Co. There will be table top B2B meetings between exhibitors and buyers taking place on day 2 and 3 of the event.

Online travel company TravelTriangle recently organised a session on GST for travel agents associated with their platform. TravelTriangle roped in reputed law firm Lakshmikumaran & Sridharan Attorneys to facilitate the session, which was conducted by Kapil Kumar Sharma. Aimed at educating TravelTriangle’s travel partners about the impending GST rollout and its implications on their business, the seminar gave attendees an overview of GST and changes in the taxation structure. Changes in law governing the travel industry in context of a marketplace were also discussed, as were the compliance requirements under the GST regime and the grey areas that still exist. Other critical aspects, such as the transition from the current market approach to the ‘One Nation, One Tax, One Market’ model proposed under the GST, were also deliberated over in detail. Speaking on the reason behind the undertaking, Yuvraj Khemani, Finance Controller, TravelTriangle said, “While the GST rollout is expected to benefit all stakeholders in the fast-growing Indian travel industry, the actual impact of the new tax regime is still not completely understood by a vast majority of businesses across the country. This was a knowledge gap that we wanted to address with this session. TravelTriangle always endeavours to support its partners at every step of their business journey and this session was a step in the same direction.” The company has launched a GST guide focussing on the travel-relevant aspects of the GST rollout, and has set up a dedicated email address for agents to mail their GST-related queries. Apart from that, TravelTriangle is also training its internal teams to aid agents with the GST registration process as well as its operational aspects.

The Outbound Tour Operators Association of India (OTOAI) addressed its members’ queries regarding the recently implemented GST regime. Chartered Accountant Ashok Batra made a presentation to explain the nitty-gritty of this new tax structure and also elaborated on how this would affect the members of the association in day-to-day business activities. The members attended the seminar with full enthusiasm and raised various queries, all of which were addressed during the event itself.

The Travel Agents Association of India (TAAI) Northern Region received a huge attendance for its seminar on GST at The Claridges, New Delhi. Sumit Jhunjhunwala, Senior Partner GMJ and Co., Mumbai, gave a presentation on how GST would affect the TAAI members and how they can cope up with the new regime. He also addressed the queries of the members on the application procedure and invoicing under GST.

The Goods and Services Tax (GST) for hotels will be charged on the rack rates, or declared rates of hotels, which will have a considerable impact on the hotel industry. According to the notification number 11/2017-Central Tax (Rate) New Delhi, dated June 28, 2017, “For accommodation in hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes, the ‘declared tariff’ will be the basis of tax to be levied.” Declared tariff has been explained as to  include charges for all the amenities provided in a unit of accommodation (given on rent for stay), like furniture, air conditioner, refrigerator or any other amenities, but without excluding any discount offered on the published charges leading to some ambiguity. However, Rashmi Verma, Secretary Tourism, Government of India, had announced in an interactive meeting in Mumbai that the GST rates are on actual invoiced rate and not on published tariff. She also assured to look into any discrepancy or anomaly in the language or wordings of the same.

Tourism Secretary Rashmi Verma announced that in May the ministry witnessed a 19 per cent increase in inbound tourist numbers despite it being peak summer. She informed that MOT has created a GST cell two days ago to address the industry issues. “We want to handhold the industry through the transition from current tax regime to the new GST regime and solve any hurdles through this,” she said. The much-awaited National Tourism policy would most probably be released before World Tourism Day commemorated on September 27, she added. Verma said that the Prime Minister’s Office and Cabinet had suggested some changes in the draft policy which have been incorporated and will releasing it soon. This was revealed during a special session on GST organised by the Indian Association of Tour Operators (IATO) for its members, which was attended by members from Central Board of Excise & Customs, Govt. of India. The government officials addressed the issues related to tour operators and explained to them the intricacies of the GST regime and how would it affect them. The event was also a farewell from IATO to former secretary tourism Vinod Zutshi, where they also welcomed the new secretary Rashmi Verma.