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Supplier compliances should not become hurdle in input credit to MSMEs: FCIK

03:01 AM Feb 03, 2024 IST | GK NEWS SERVICE
supplier compliances should not become hurdle in input credit to msmes  fcik
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Srinagar, Feb 2: Federation of Chambers of Industries Kashmir (FCIK) has demanded allowing input credit to MSMEs on the proof of their purchases without tasking them with the responsibility of ensuring supplier compliance.

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An interactive session of the FCIK delegation was held with Commissioner Sales Taxes PK Bhat, Additional Commissioners Ali Afsar Khan, Shakeel Maqbool and Deputy Commissioners of the State Taxes Department on Friday. The delegation of FCIK was led by its former president and Advisory Committee Member Zahoor Ahmad Bhat and included Ovees Jami and others.

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As per the statement, while projecting the difficulties faced by MSMEs on denial of the benefit of input tax credit until their supplier has actually deposited the tax with the government, Zahoor Bhat argued that the filling of returns and payment of due tax devolved on every taxpaying vendor in the country failing which they were subjected to penalties and other damages. He asked if the GST law was so tough on defaulters, then why the Tax department shouldn’t consider granting input tax benefits to every production of valid invoices from the suppliers to save MSMEs from putting in extra effort and financial stress.

FCIK has also demanded evolving a mechanism to facilitate MSMEs with input credit of the tax subsumed in the prices of goods purchased from unregistered vendors.

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While making a demand for minimizing the high compliance burden in GST laws and rules, FCIK demanded making these industry-friendly in consonance with the parameters and spirit of ease of doing business more so in consideration of the fact that the majority of micro and small units lack high-end facilities in their units.

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Several issues pertaining to the filing of returns, e-way billing, tax on advances and the notices issued by the department came under discussion at length.

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FCIK also demanded a simple and smooth mechanism for disbursement of SGST in favour of eligible MSMEs of J&K. A demand was made for evolving and approving an alternative mechanism, preferably cashless, for reimbursement of SGST to eligible MSMEs.

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FCIK also raised the issue of amnesty to be granted for any lapses of defaults under the GST regime since its inception and in this regard solicited the support and recommendations of the J&K government to the GST council and other competent authorities.

While conveying gratitude for the grant of amnesty under Pre-GST regimes, Ovees Jami demanded for grant of extension in the scheme till March 2024. He also sought clarification on eligibility criteria and some other issues that come in the way of settlement by assessing authorities. Jami informed the meeting that manufacturing enterprises were exempted from VAT under the remission mechanism and had rarely any tax liability against them. He also reminded that the government had promised MSMEs a clean slate for all previous tax regimes before making the transition into the current GST regime.

The Commissioner of State Taxes Department assured of the full support and cooperation of his department to the MSMEs to find out simpler and friendly ways for compliance. He assured that the points raised by FCIK would be taken up with relevant quarters for seeking redressal, the FCIK statement said.

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