GST: Know About The Important Changes of GST in 2021

The Union Budget 2021 promises that the central government will take every possible effort to make the GST structure easier to do business.

Statement of Return and Reconciliation for the Year

The union budget 2021 proposes removing Section 35(5) of the CGST Act, which removes the requirement to get annual accounts audited and submit GSTR-9C to designated professionals.

Also, the Government has proposed an amendment to Section 44 of the CGST Act, which would allow taxpayers to self-declare their taxes under GSTR-9C. Also, the Commissioner has the power to exempt certain taxpayer classes from filing the annual GST return.

Input tax credit matching

CGST Act relating to the availability of input tax credit on invoices and debit notes, a new clause has been inserted by the Government. Taxpayers can only claim the ITC due to them only if the supplier provides details of the invoice or debit note to the recipient and has informed them of the GST India details. 

Tax Self-Assessment and Recovery

During this union budget 2021, the Government proposed adding a clarification to Section 75(12) of the CGST Act, which clarifies that self-assessed tax now includes the tax liability declared in GSTR-1 (excluding GSTR-3B).

Conveyances and Goods Seized & Confiscated in Transit

As part of an amendment to Section 74 of the CGST Act, the Government proposes creating a separate procedure from tax recovery if goods and conveyances in transit are seized and confiscated.

Further, the Government has decided to change Sections 129 and 130 of the CGST Act to delink the procedure of detaining, securing, and releasing goods and conveyances in transit from the procedure of confiscating goods and conveyances. Furthermore, the penalty amount under section 129 has been doubled. Now, the taxpayer must pay a tax of 200% on all detained and seized goods, ARN status for GST and conveyances.

Attachment provisional

As part of its proposal to amend Section 83 of the CGST, the Government proposes to increase the time when assets can be attached provisionally in cases underneath Chapter XII (Advance Ruling). They might also do the same for Chapter XIV (Search, inspection, arrest and seizure) and Chapter XV (Recovery and Demands).


With effect from July 1, 2017, the Government has proposed amending Section 50 of the CGST Act so that interest will not be determined by the tax paid using ITC as per the new amendment.

Appeal filing pre-deposit

The Government has proposed to amend section 107(6) of the GST India Act in this union budget 2021 so that in cases of seizures and confiscations of goods and conveyances in transit, only taxpayers who pay a penalty of 25% will be able to appeal for ARN status for GST.

Supplies for the SEZ

The Government has proposed amending section 16 of the IGST Act in this union budget 2021 to apply zero rates only when goods or/and services are supplied to a developer or unit in a special economic zone for authorized purposes.

Associations and clubs

The Government has decided to insert a new Section 7(1) (aa) in the CGST Act, which will require clubs and associations to charge a CGST on the supply of goods or services, for cash, CDN, or any other valuable consideration, to their members or constituents.

Information Collection Power

In this union budget 2021, the Government proposes to amend sections 151, 152, and 168 of the CGST Act to give the jurisdictional Commissioner more authority over matters related to the CGST Act.

Supplies that were zero-rated and refunded

With the Union Budget 2021, the Government proposed to amend Section 16 of the IGST Act to limit zero-rated supplies to notified taxpayers and notified goods and services only. The refund can also be recovered if the goods are exported without the remittance of foreign exchange.

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By Cary Grant

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