Proposal to Make the GST Registration Simpler

In a bid to simplify the goods and services tax (GST) registration process, the law committee has proposed to the GST Council to implement different categories of GST registrations based on risk assessment and aligning the registration process with passing on of input tax credit (ITC).

• Objective:
  • Process for passing on ITC is in line with alignment; simplifies procedure for small businesses.

• Types of GST Registration:
  • New/Small Businesses: Will be processed and approved with in three working days post-Aadhaar authentication through OTPs.
  • Deemed Trusted Business: The process is simplified, with processing done in three working days, however without extra verifications.
  • Businesses on the Emerge List: Stricter provisions while registration, an initial non-refundable application amount along with security deposit.

Various Steps Involved in GST Registrations

• Small Business: Accelerated with only minimal verification requirements.
• Trusted Business: Easy route with no verification if it passes their listed requirement standards.
• Emerging Business: Rigorous, also requiring a security deposit to ensure it does not become misused, with assurance that its ITC will be used with cash payment.

Cross-categorial Movement

• Small Business has to move into the Emerging Business to qualify if they meet certain deposit requirements.
• They would shift to the Deemed Trusted after a detailed verification process from a tax officer.

Time Line and Discussions:

• Law committee to discuss the comprehensive guidelines and amendments in GST Act and rules after receiving the preliminary approval from the GST Council.
• Changes expected would support ease of doing business and stimulate growth of small and emerging businesses in India.