In a significant move, the Council of the ICSI at its meeting held on 9th January 2020 has decided to issue Guidance on Scale of Fee for Professional Services.
To harmonize the diverse practices followed by PCS while charging professional fees for rendering such services and to provide the guiding principles for fixing the fee and to ensure transparency between the client and the PCS also pave the way for a just and reasonable scale of fees to be charged by professionals on the basis of their experience, expertise, exposure, operational costs, associated risks, penalties for wrong certification and the market forces, the Council has considered the Guidance on scale of fees for Services.
The Council with a view to standardization of fees to be charged/fixed by professionals and to protect the rights of new entrants to the profession has decided to come up with a basis for determining the fee for professional services taking into account the time spent in rendering the service, complexity of the assignment, nature of business, and premium for number of years of experience of practice as a professional has approved the ICSI (scale of fees for Professional Services) Guidance, 2020.
The Institute of Company Secretaries of India (ICSI) has announced the dates of results of the CS Foundation Programme Examination.
The Result of CS Foundation Programme examination held on 28th and 29th December 2019 would be declared on Saturday, the 25th January 2020 at 11:00 A.M.
The result along with individual candidate’s subject-wise break-up of marks will be available on the Institute’s website: www.icsi.edu.
Formal e-Result-cum-Marks Statement of Foundation Programme Examination will be uploaded on the website of Institute: www.icsi.edu immediately after the declaration of result for downloading by candidates for their reference, use, and records.
Bhutan’s Finance Minister Namgay Tshering issued a bill at the National Assembly amending the Tourism Levy Exemption Act 2018 that made it mandatory for all tourists visiting Bhutan from the neighboring countries to pay Sustainable Development Fee (SDF) of INR 1000 (25% OF USD65).
The proposed amendment expects to generate additional revenue along with a promotion to make Bhutan a high-end tourism destination. As per the reports, the country wants to control the tourists from South Asian countries and also the fees are levied considering the situations of tourists violating the local laws and disrespecting their cultures.
There is a concern that the amendment will affect the hotelier’s investment as the number of tourists drop. The owners will eventually have to cut down the number of employees which will, in turn, result in unemployment and uncertainty in the job market.
Bhutan has also extended an idea to charge visa fees to regional tourists in line with Bhutan’s high-value-low-impact tourism policy. This, if applied, will make it way too expensive for many Indian tourists to afford.
The Maharashtra Authority for Advance Ruling (AAR) on filing an application by the applicant Shapoorji Pallonji and Company Private Limited address the issues and held that building completion and finishing services will be regarded as a single service and not the separate services and 18% GST will be applicable.
The application is filed by the applicant namely Shapoorji Pallonji and Company Private Limited, who is the contractor at Joyville, Vihar. It filed an application under Section 97 of CGST Act and MGST Act raising the question of whether the building completion and finishing services be regarded as a separate service or not and application consists of the question pertaining to the rate of the GST applicable to contracting services that do not fit under the criteria of low-cost houses.
While addressing the issues the bench comprising of P. Vinitha Sekhar, Addl. Commissioner of Central Tax and A.A. Chahure, Joint Commissioner of State Tax held that the applicant was eligible for the concessional rates of GST. Further, the bench also held that both building completion and finishing services are regarded as a single service and not a separate service. The bench stated that 18% of GST will be applicable in the case of contracting services that do not fit in the criteria of low-cost houses.
Subscribe Taxscan Premium to view the JudgmentThe Reserve Bank of India (RBI) has allowed the Financial Institutions to conduct businesses in Indian National Rupees in International Financial Services Centres (IFSC).
The RBI has issued notification On January 7, 2020, added a new proviso to Foreign Exchange Management (International Financial Services Centre) Regulations to incorporate this change.
The Newly added proviso reads as, “Provided that, Reserve Bank may, through general or specific permission, allow a financial institution or a branch of a financial institution to conduct such business in Indian Rupee with such persons, whether resident or otherwise as it may determine.”
An IFSC caters to customers outside the jurisdiction of the domestic economy. Such centres deal with flows of finance, financial products, and services across borders.
Subscribe Taxscan Premium to view the JudgmentThe Customs Excise and Service Tax Appellate Tribunal (CESTAT) Kolkatta, ruled that Service Tax Refund can be claimed on the basis of monthly consolidated Service Tax Certificate for Transportation of goods (STTG Certificate) issued by the Indian Railways.
The appellant is engaged in the manufacture of various petroleum products classifiable under Chapter27 of the schedule to the Central Excise Tariff Act. 1985. They had submitted 3 (three) claims of refund of Service Tax recovered from them by South Eastern Railways towards transportation of petroleum products during the months of October’12, November’12 and January’13 on the ground that in service by way of transportation in India by Rail of such petroleum goods were exempt from Service Tax. The refund claim was granted.
Against the above OIO’s Revenue preferred an appeal before Ld Commissioner of Central Excise and the same was allowed stating that the refund granted should be recovered from the IOCL along with interest in terms of section 68 of the Finance Act, 1994, the service provider is liable to pay Service Tax. Hence, if paid, the refund of Service Tax, if eligible is available to the person who has paid, i.e the service provider.
The Judicial Member P.K.CHOUDHARY has pronounced the Order on an appeal filed by M/s Indian Oil Corporation Ltd.
In the light of decisions which was decided by the Constitution Bench in Mafatlal Industries Ltd Vs Union of India 1997 (89) ELT 247(SC). This ratio was followed in Indian Farmer Fertilizer Coop. Ltd. Vs C.C.E., Meerut-II 2014 (35) S.T.R. 422 (Tri. – Del.) and affirmed by Allahabad High Court 2014 (35) S.T.R. 492 (All.).
The principle which has been enunciated in the Constitution Bench judgment is as follows:
“A claim for refund, whether made under the provisions of the Act as contemplated in Proposition (i) above or in a suit or writ petition in the situations contemplated by Proposition (ii) above, can succeed only if the petitioner/plaintiff alleges and establishes that he has not passed on the burden of duty to another person/other persons. His refund claim shall be allowed/decreed only when he establishes that he has not passed on the burden of the duty or to the extent he has not so passed on, as the case may be.”
The following clause shall be inserted, a Service Tax Certificate for Transportation of goods by Rail issued by the Indian Railways, along with the photocopies of the railway receipts mentioned in the STTG certificate Hence, a Certificate issued by railway is a valid document under the Act.
While allowing the appeal AAR also states that the refund claim is to be obtained from the concerned tax authority on the basis of monthly consolidated (STTG) certificate issued by Railways and eligibility for refund of service tax is sustainable on legal grounds.
Subscribe Taxscan Premium to view the JudgmentThe Supreme Court has dismissed an appeal by Delhi Sales Tax Authorities and upheld the final judgment and order passed by the High Court Of Delhi that sales tax cannot be imposed on the basis of work contract of supply of goods from Mumbai to Delhi
The Assessee is engaged in the business of supply, erection, commissioning and installation of lifts/elevators in various classes of places including residential buildings, government offices, and hospitals. It is also a registered dealer under the provisions of the Delhi Sales Tax Act, 1975. It, however, has its manufacturing facilities at Mumbai, where its components are produced. The Mumbai unit also stores the products so manufactured.
The Delhi Sales Tax Authorities sought to assess transactions for three distinct periods. The Assessing Authority sought to hold that the burden of the local sales tax levy was laid upon the dealer, upon an analysis of the contracts entered.
The adjudicating authority has prevailed that the contracts were indivisible work contracts, the title of each of the elevators passed onto the customer upon payment, and that for the purposes of dispute resolution, the Courts of Delhi had exclusive jurisdiction.
The two-judge bench comprising of Justices A.M. Khanwilkar and Dinesh Maheshwari of Supreme Court made an order on a special leave petition filed by Commissioner of Value Added Tax, Delhi.
The bench opined that the placement of an order by the agent for the procurement of the lifts, in this case, was merely an offer. It is only upon its acceptance and further steps taken by the supplier that an offer crystallizes into a binding promise or contract. That took place in Mumbai. It is now too far well settled that the incidence of Central Sales Tax or even sale of goods, occurs where the goods are appropriated to the contract.
While dismissing the appeal, the Court observed that the place where the appropriation took place, is undoubtedly Mumbai so the incidence of central sales tax or sale of goods, occurs in Mumbai.
Subscribe Taxscan Premium to view the JudgmentLike every other law which provides the aggrieved to file review, revision, and appeal against the decision of any other authority, the GST payee in Chandigarh is also empowered to file a revision petition against the order passed by any GST officer.
On 13th January 2020, the Union government through the official notification introduced the two-level Revisional Authority in the city of Chandigarh. As per the notification out of the 2 levels, the first level consists of the revisional authority consists of Commissioner or Principle Commissioner, GST.
The function of the Commissioner or Principle Commissioner, GST would be to preside over the appeal filed against the decisions or orders passed by the Joint or Additional Commissioner, GST.
At the second level will be the Joint or Additional Commissioner, GST whose function will be to adjudicate the proceedings against the order passed by deputy commissioner or assistant commissioner or superintendent of central authority.
The rationale behind such notification passed by the union is to address the grievances of the aggrieved GST payee in Chandigarh and empowered them to file a revision petition against such order which is not satisfactory for the GST payees.
Subscribe Taxscan Premium to view the JudgmentThe Vietnam Ministry of Finance has issued the draft pronouncement amending certain tax rulings. Some of the main aspects of the draft include:
The draft decree would be effective from the date the Government signs the proposal.
The Bangalore Regional Bench of Customs Excise and Service Tax Appellate Tribunal (CESTAT) in the case of M/s. JMT Consultant Detailing Pvt. Ltd. vs. Commissioner of Central Tax, Bangaluru East has held that the refund of unutilized credit can’t be denied if assessee voluntarily debits or credit amount in Form GSTR-3B.
The appellant is engaged in the Structural Design and Detailing Consultancy Services. Prior to coming up with GST regulation, the appellant used to receive Cenvat Credit in his Cenvat Credit Account. There was the unutilized amount in his Cenvat Credit Account which was claimed by the appellant. The issue raised was whether the unutilized credit can be denied, if in case the assessee voluntarily debits credit the amount in GSTR-3B?
While allowing the appeal, the CESTAT bench headed by judicial member S.S Garg held that the assessee cannot be denied the refunds of the unutilized credit amount and debit.
Moreover, the decision of the tribunal to accept the appeal was made in accordance with the precedent given in the case of M/s Global Analytics India Pvt. Ltd. vs. Commissioner of GST.
Subscribe Taxscan Premium to view the JudgmentThe Central Board of Direct Taxes (CBDT) has explained broad scheme of Tax deduction at Source (TDS) from of persons who is responsible for paying any income chargeable under the head “Salaries”
The income-tax is required to be calculated on the basis of the rates subjected to the provisions related to the requirement to furnish PAN or Aadhaar number, as the case may be, as per sec 206AA of the Act, and shall be deducted at the time of each payment.
No tax, however, will be required to be deducted at source in a case unless the estimated salary income including the value of perquisites, for the financial year exceeds Rs. 2,50,000/- or Rs.3,00,000/- or Rs. 5,00,000/-, as the case may be, depending upon the age of the employee.
Payment of Tax on Perquisites by Employer:
An option has been given to the employer to pay the tax on non-monetary perquisites given to an employee. The employer may, at its option, make payment of the tax on such perquisites himself without making any TDS from the salary of the employee. However, the employer will have to pay the tax at the time when such tax was otherwise deductible.
Salary From More Than One Employer:
In situations where an individual is working under more than one employer or has changed from one employer to another. It provides for deduction of tax at source by such employer (as the taxpayer may choose) from the aggregate salary of the employee, who is or has been in receipt of a salary from more than one employer. The employee is now required to furnish to the present/chosen employer details of the income under the head “Salaries” due or received from the former/other employer and also tax deduction at source (TDS) therefrom, in writing and duly verified by him and by the former/other employers. The present/chosen employer will be required to deduct tax at source on the aggregate amount of salary (including salary received from the former or other employers).
Salary Paid in Foreign Currency:
For the purposes of deduction of tax on salary payable in foreign currency, the value in rupees of such salary shall be calculated at the “Telegraphic transfer buying rate” of such currency as on the date on which tax is required to be deducted at source.
Relief When Salary Paid in Arrear or Advance:
Under section 192(2A) where the assessee, being a Government servant or an employee in a company, co-operative society, local authority, university, institution, association or body is entitled to the relief under Section 89 he may furnish to the person responsible for making the payment, such particulars in Form No.10E duly verified by him, and thereupon the person responsible, as aforesaid, shall compute the relief on the basis of such particulars and take the same into account in making the deduction.No such relief shall be granted in respect of any amount received or receivable by an assessee on his voluntary retirement or termination of his service.
Subscribe Taxscan Premium to view the JudgmentThe CESTAT New Delhi held that Emails and other electronic evidence cannot be relied upon to prove undervaluation. The charge of undervaluation cannot be made out on mere assumptions and presumptions.
The ruling was made by a division bench comprising of members Judicial Member Anil Choudhary and Technical Member Bijay Kumar in the case of H S Chadha Vs. Commissioner of Customs (Preventive).The appellant M/s Vortex Rubber Industries Pvt Ltd filed Bill of Entry No. 6224101 dated 24.07.2014 for clearance of Tyres and Tubes. However, the consignment was examined by Customs Preventive and the goods were seized under Section 110 of the Customs Act, 1962. The Department also alleged undervaluation and misdeclaration in the previous imports of the appellant. The investigation regarding undervaluation of appellant M/s Indo Silicon Electronics Pvt Ltd was also done since this Company also had the same Director Shri H S Chadha which also imported tires and tubes. Accordingly, on the allegation of undervaluation, Show Cause Notice was issued to appellants.
The appellants state that the impugned order has been passed in a mechanical manner without appreciating that the prices as reflected in the emails are only quotations and not the final price and thus cannot be relied on for value enhancement of the goods
The department submitted that MRP/RSP was not found on some of the tires and parallel invoices were found in the emails exchanged between the appellant and the suppliers.
The tribunal found that there is no mention regarding which rule of the Customs Valuation Rules 2007 has been applied to arrive at the re-determined value and there is also no sequential application of Rules. Emails and other electronic evidence cannot be relied upon to prove undervaluation. The charge of undervaluation cannot be made out on mere assumptions and presumptions. It held that for the appellants M/s Vortex Rubber Industries Pvt Ltd, and M/s Indo Silicon Electronics Pvt Ltd confiscation of goods, denial of SAD exemption, the demand of differential duty, interest and penalty cannot be sustained on the appellant-Company and appellant Director Shri H S Chadha. Resultantly, the impugned order against appellants is set aside. The appeals are allowed with consequential benefits and any amount appropriated by the impugned orders stands revoked.
Subscribe Taxscan Premium to view the JudgmentThe Delhi High Court has held that CBDT in its circulars No. 672 dated 16.12.1993 has made it clear that the acquisition of flat through allotment by DDA has to be treated as construction of flat and deduction capital gains under Section 54 of the Act is allowed.
The ruling was made by a division bench comprising of Justice Vipin Sanghi and Justice Sanjeev Narula in the case of Pr. Commissioner of Income Tax-17 New Delhi. Vs. Sh. Akshay Sobti. The assessee had sold the property at Jor Bagh on 21.12.2011. On the said sale, the assessee has claimed deduction of capital gains under Section 54 of the Act. The AO made disallowance of deduction on the ground that the assessee entered into an agreement dated 10.02.2006 and the said date of the agreement is to be treated as date of acquisition, which falls beyond the one year period provided under Section 54 of the Act and is also prior to the date of transfer. The assessee was required to purchase a residential house property either one year before, or within two years after the date of transfer of original asset; or within a period of three years after the date he was required to construct a residential house.
CBDT in its circulars No. 672 dated 16.12.1993 has made it clear that the acquisition of flat through allotment by DDA has to be treated as construction of flat, would apply to cooperative societies and other institutions. The ITAT has relied upon the said circular and held that the builder would fall in the category of other institutions and possession was granted on 30.03.2013. The assessee had booked a semi-furnished flat with the builder, namely, Magnolias DLF Golf Links. Accordingly, the assessee had a window of three years period from 21.12.2011 till 21.12.2014 to construct a house property, calculated from the date of transfer of original asset. Against the order of o CIT (A), the Revenue filed an appeal before this court.
The appellant argued that the payments to Magnolias DLF and bank, interest on loans and on the cost of improvement of the property have not been made from the sale proceeds of the Jor Bagh property and therefore the benefit of Section 54 of the Act should not be allowed to the assessee.
While dismissing the appeal, the court held that Respondents had fulfilled the conditions laid down under Section 54 (1) of the Act. The presumption drawn by the AO for making the addition was patently false, based on conjectures and surmises, without appreciating the records and making an inquiry to discredit the evidence and confirmation placed on record by the assessee. This consistent factual finding arrived at by the CIT (A) and ITAT does not give rise to any question of law.
Subscribe Taxscan Premium to view the JudgmentThe Directorate General of GST Intelligence ( DGGI ) has issued directions to all Zonal Chief Commissioners on Blocking of Input Tax Credit under rule 86A(1)(a) of CGST Rules.
Rule 86A. Conditions of use of amount available in electronic credit ledger.-
(1) The Commissioner or an officer authorised by him in this behalf, not below the rank of an Assistant Commissioner, has reasons to believe that credit of input tax available in the electronic credit ledger has been fraudulently availed or is ineligible in as much as
a) the credit of input tax has been availed on the strength of tax invoices or debit notes or any other document prescribed under rule 36-
b) issued by a registered person who has been found non-existent or not to be conducting any business from any place for which registration has been obtained; or
2) without receipts of goods or services or both.
The DGGI directed that, All the Zonal Chief Commissioners have the facility to block/unblock ITC availed in a situation covered under Rule 86A(1)(a) of the CGST Rules, 2017 against fake invoices or against invoices without receipt of goods or services or both if such availed of credit are located in their jurisdiction.
The Chief Commissioners of each zone should appoint an officer of the rank of Dy. Commissioner/A.C., as a nodal officer, assisted by a few more officers, who should undertake this activity.
In a Communication issued to all Principal Commissioners of the State Department, the DGGI also directed that, all over India, should also make a Cell in their zone head office nominating one AD/DD rank officer as nodal officer assisted by a few other officers to block the credit of such avails received from their zonal CGST Chief Commissioner, who are located outside the jurisdiction of the concerned CGST Zone.
Subscribe Taxscan Premium to view the JudgmentThe Central Board of Direct Taxes (CBDT) has clarified that no marginal relief shall be available in Health Cess (HC) and Education Cess (EC).
EC is an additional levy on the basic tax liability. The government uses the collected money from cess to improve the structure of education in the country. Also, the government does such charitable works like giving Mid Day Meal, Free books, uniforms, cycle, etc. to the students with the money collected as cess.
The rate of EC is 3% ( 2% for Primary education and 1% for Secondary & Higher education). It is levied on Personal income tax and Corporation tax.
An existing 3% will be replaced by a 4% ‘HEALTH AND EDUCATION CESS ‘. It means this 4% rate will be applicable from the financial year 2018-19 / AY 2019-20. This is to take care of the education and health needs of poor and rural families. In the Budget 2018, Finance Minister Arun Jaitley proposed various programs to meet the education and health needs of Below Poverty Line (BPL) and rural families such as improving the quality of education, teachers, digital initiatives, quality education to tribal children
“Health and Education Cess” shall be levied at the rate of four per cent of income tax including surcharge wherever applicable.
Subscribe Taxscan Premium to view the JudgmentThe National Revenue Agency of Bulgaria has announced the changes to be applied to the calculation of turnover for the VAT registration threshold. The new rules are applicable to the homogeneous transactions or activities between both related and unrelated parties in an agreement.
If two or more of the following are same or identical, it is considered to be a homogeneous activity:
If the activities are interrupted for more than a month, they will not fall under homogeneous activities.
Under the new rules for turnover, a calculation to see if the threshold (BGN50,000) is met for VAT registration, when the activities between the related or unrelated parties are homogeneous and with a commercial interest, then the turnover of each subsequent party will include the turnover of the prior party involved.
Earlier, the Bulgaria Finance Ministry was thinking about bringing in some amendments to the VAT turnover threshold of BGN50,000. The proposal was that the threshold applies only to the residents and the non-residents will have to register before the first commercial supply is made.
The new rules for the calculation of threshold are expected to prevent non-compliance of VAT registration.
The Romania is abolishing its VAT split payment mechanism from 1 February 2020. The cancellation was following the warning from the EU commission that the regime infringes the EU VAT rules and the freedom to provide services (Article 56 TEFU). Romania requested for a derogation from the pertaining Directive but was rejected by the commission.
The VAT split payment regime was optional for the businesses until 1 January 2018 which became mandatory from then. The mechanism takes away the “VAT collection” role of the business and the VAT portion of the invoice will have to be paid directly to the tax authorities by the customers.
The mechanism already exists in Poland and Italy. Although the split payment scheme is canceled, Romania is proceeding with the introduction of a new SAF-T file that has to be submitted by all taxpayers.
The Insolvency and Bankruptcy Board of India (IBBI) has notified the Insolvency and Bankruptcy Board of India (IBBI) ( Voluntary Liquidation Process ) (Amendment) Regulations, 2020 on 15th January. 2020.
The aforesaid amendment provides that a Liquidator shall deposit the number of unclaimed dividends if any, and undistributed proceeds, if any, in liquidation processes along with any income earned thereon into the Corporate Voluntary Liquidation Account before submission of an application for dissolution of the corporate person. It also provides a process for a stakeholder to seek withdrawal from the Corporate Voluntary Liquidation Account.
The amended regulations are effective from January 16, 2020.
Subscribe Taxscan Premium to view the JudgmentThe Central Board of Direct Taxes (CBDT) has issued a detailed circular for deduction of tax at source ( TDS ) from salaries under Section 192 of the Income Tax Act, 1961.
Section 192 of the Income Tax Act, 1961 deals with tax deducted at source (TDS) on salary. Your employer will deduct TDS from the salary payable to you. The salary you receive from your employer is categorized in ‘Income’ under the head ‘Salary’ and he/she will be responsible for deducting TDS on an average rate of income tax based on the current slab rate during the relevant financial year by considering your estimated income.
In the Circular, the CBDT has explained various Rates of Income Tax As Per Finance Act, 2018, Surcharge of Income Tax, Health and Education Cess, Broad Scheme of Tax Deduction at Source from Salaries, Persons Responsible for Deduction of Tax and their Duties, Computation of Income under the Head ―”Salaries”, Rebate of Rs.12500 for Individual having total Income upto Rs. 5 Lakh, TDS on Payment of Accumulatd Balance under Recognised Provident Fund and Contribution from Approved Superannuation Fund and DDOs to Obtain Evidence /Proof of Claims.
The CBDT has also explained some illustrations, Form No. 12B, 12BB, Revised Procedure For Furnishing Qtly E-TDS/TCS Statement by Deductors/Collectors, Procedure Of Furnishing Form 24G Person Responsible for Filing Form 24G in case of State Govt Departments/Central Govt Departments, Procedure of Preparation of Quarterly Statement of Deduction of Tax U/S 200 (3) etc.
Subscribe Taxscan Premium to view the JudgmentThe Delhi Bench of Income Tax Appellate Tribunal (ITAT) in the case of DCIT v Kushal Infra project Industries allowed exemption on agricultural lands bought without an intention to purchase the land for any business purposes.
The Bench constituting of B.R.R. Kumar and Bhavnesh Saini as Accountant and Judicial Members respectively held the following:
The Bench observed that according to the Certificate of Patwari as well as Tehsildar and Sub-Divisional Magistrate of Delhi submitted by the assessee, it is clarified that the land in question is situated more than 9 km from the municipal limit and the population of the area is about 7000 only. The Bench upheld the decision of the CIT(A) in holding that land in question is agricultural land and the amount earned on the sale of the land to be a capital receipt.
The Bench stated that the assessee had admittedly sold the agricultural land as there was no intention to do any business activity, therefore, the period of holding would not be relevant. The same is evident from the fact that assessee never converted the land into non-agricultural, neither did he create any plot or carried any development activities or make any advertisements for the sale of land.
However, the instant Tribunal set aside the order of the CIT(A) on the grounds held by AO.
Subscribe Taxscan Premium to view the JudgmentThe Bhutan’s Ministry of Finance introduced GST of flat 7% that will replace all indirect taxes like sales tax, customs duty and exercise duty as per the Goods and Service Tax (GST) Bill of Bhutan 2020. It is seen as the biggest and revolutionary tax reform of Bhutan.
Other announcements under the GST Bill 2020 included the imposition of 20% Excise Equalisation Tax on unhealthy goods, 100% tax on alcohol/tobacco and 20% tax on the plastic wrapping.
What is GST and how is it beneficial?
Goods and Service Tax (GST) is an indirect tax levied on goods and services that replaced the indirect tax laws (which had different tax rates) that previously prevailed in Bhutan. It is a single indirect tax system for the whole country.
GST is a consumption-based tax and will affect all the imports and all the goods and services consumed within Bhutan. GST is imposed at a point of consumption while the business will collect the tax at different stages which makes it a multi-stage tax.
The introduction of GST system is expected to reduce the price of goods when it reaches to the final consumer as it avoids double and triple taxation. GST will bring in a simpler tax administration and an increase in the tax revenue by broadening the tax base and unorganized sectors of businesses. Return filing is relatively easy and less complex and also there will be provision for refund. But it can make the service-based industries like flights, movies, etc. expensive.
Bhutan has received considerable support from the IMF and The World Bank in the implementation of the regime.
