Business & Finance

GST: The Central Government postpones reverse charge proposal till September 30th

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NEW DELHI- As a move in favor, the Centre has extended the date of reverse charge mechanism till September 30th on purchase of goods or services made by registered dealers from unregistered dealers within the state. This is the second time such extension has been made. Earlier the suspension date was shifted from March 31st to end-June 2018.

According to this move, any registered dealer can buy goods or services from an unregistered dealer without digging in GST compliances under reverse charge till September 30th. This move of Centre comes as a relief to large businesses and motivate them to purchase from unregistered dealers, tax experts said.

M S Mani, Partner of Deloitte India, said “The reverse charge on supplies from unregistered dealers was essentially an anti-evasion tool intended to increase the number of registered dealers and its extension signifies that while the government does not want to increase the compliance burden, it reserves the right to re introduce reverse charge after three months if revenues are not as per expectations.’’

Abhishek Jain, Partner, EY, quoted: “This extension was much sought for as the industry genuinely wanted some time before adhering to additional compliances envisaged for such procurements.” 

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