GST Council meet: Large Transitional ITC claims shocks govt
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Against a robust collection of Rs 95000Cr (approx.) in the first month of GST implementation, Transitional input credit of Rs 60,000Cr has been claimed by entities. Significant refunds claimed by entities for the pre-GST (goods and services tax) stock has left the government startled.
For the close to Rs 95,000 crore of revenue collected for July so far, around Rs 60,000 crore has been claimed as input tax credit for taxes paid for the period before July 1, according to state official sources.
The input tax credit for the transitional period has been claimed through the TRAN 1 form. Companies had a 90-day period from July 1 to claim credit for the excise duty already paid on inputs.
The GST Council had allowed companies to claim 100 per cent input tax credit by uploading excise payment invoices for the period before July 1. In case of unavailability of invoices, the Council had allowed 40 per cent input tax credit.
In fact, the limit on input tax credit was raised to 60 per cent from 40 per cent of the GST liability on items with tax rates above 18 per cent at the June 4 meeting.
Besides, the entire 100 per cent input tax credit can be claimed on high-value items, priced above Rs 25,000, with a chassis number.