Due to the Covid-19 pandemic, the compliance relaxations offered by the central government under the Goods and Services Tax (GST) regime are inadequate, according to a survey of small and medium businesses affected by the lockdown and mobility limitations in maximum States. In this article, we will discuss Small Businesses requesting to extend the time for GST Compliance due to lockdown.
Small businesses need more time for GST compliances
Due to the lockdown, Several small and medium scale businesses face crises including 89% of small businesses have demanded that the government waive the penalty on late payments and accept GST return filings for the March to May period till June 30, as per a survey performed over the past week by LocalCircles of 2,456 such enterprises located in 122 districts.
Now On May 1, the government had instructed some relief measures for businesses to cope with the second wave of the pandemic, allowing delayed filing of some returns, waiving penalties for 15-30 days, and diminishing the interest on postponed tax payments in a graded way.
While returns associated with computing input tax credits were permitted 15 more days, the due date for filing the GSTR-3B and remitting taxes was not broadened. The interest levied on delayed tax payments was not waived, prompting accountants to advise businesses to accept without waiting for the input tax credits to firm up.
Further Notification by Central Government
Further, Small businesses from across the country have been putting up the issue of their inability to confront the GST payment deadline as most have been shut due to local lockdowns and curfew restrictions. A visit by the accountant or a visit to them is not an option for most businesses since early April and hence the majority are incapable to make their GST payment. Likewise, most have been incompetent to file the return for the quarter ending March 31.
The central government had escalated the necessity for relaxation of the March 21 GST payment and return to the Finance Ministry on April 23, but the relaxations granted by the ministry on May 1 were not enough, the survey noted.
Moreover, 73% of small businesses want no penalty and interest on March GST payment and return filing till June 30, while 78% want no penalty and interest on April and May GST payments till June 30. Overall, 89% of small businesses want no penalty and interest relaxations on GST late payments and return filing till June 30,” as per the survey administered by the community platform.