Despite the initial hiccups, GST compliance remained high in January. According to the Department of Revenue and Customs, over 87 per cent of registered businesses filed their returns. The department collected more than Nu 600 M for the January filing, down from the average monthly collection of around Nu 700 M before the introduction of GST.
Of the 3,300 taxpayers required to file monthly returns, nearly 2,900 have already compiled, as the second filing period for February begins.
According to the latest GST return outcomes, over 1,300 GST registrants have filed debit returns, while around 1,080 registrants have submitted credit returns.
Debit returns refer to cases where businesses report that the GST they collected from customers on their sales is higher than the GST they paid on their purchases. This means they owe the remaining tax amount to the government.
On the other hand, credit returns occur when the GST a business paid on its purchases is higher than the GST it collected from its sales. In such cases, the business has excess input tax credit, which can either be carried forward to offset future tax payments or refunded, depending on the tax rules.
Additionally, close to 500 registrants have filed zero returns, indicating that they reported no taxable transactions during the filing period.
“A zero return means businesses are claiming they have neither sold nor bought goods, and therefore have neither paid nor collected GST, which is unlikely. We request the authorities to look into this again,” said Kuenzang Thinley, GST and BITS Commissioner with the Department of Revenue and Customs.
He added that even if businesses may not have been operational, GST-levied expenses such as commercial rent, electricity, and telecom services should still be reflected when filing their returns.
Meanwhile, about 430 businesses have yet to file their GST returns. The Department of Revenue and Customs urges them to do so by visiting any of its eight Regional Revenue and Customs Offices soon.
He said, “It will take about a month to examine the return filings. During this time, authorities will determine the amount to be refunded to businesses and any additional charges payable to the government.”
The Department of Revenue and Customs said the objective of the Goods and Services Tax system is not primarily to generate revenue, but to strengthen and streamline the country’s tax system.
Kinzang Lhadon
Edited by Phub Gyem
