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No Centralised Registrations for Banks Under GST: FinMin

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The government has ruled out centralised registration for banks under the goods and services tax (GST) and has mandated separate registration for each state they operate in.Banks have been demanding a single centralised registration system, like at present, arguing that multiple registrations would create procedural and compliance problems.

“They have no choice. They have some issues relating to registration, which will be resolved in due course,“ said a top finance ministry official. At a meeting of finance ministry with the heads of public sector banks here on Monday, a separate session was held on issues related to GST.

“We have eased some of their problems.GST will be rolled out as per schedule from July 1,“ the official said. Currently, banks as well as non-banking finance companies (NBFCs) with pan-India operations can discharge their service tax compliances through a single 'centralised' registration. But under GST, they would need to obtain a separate registration for each state where they operate.

But they have been allowed to submit a single invoice per state per month instead of multiple invoices for each transaction.The GST Council has fixed an 18% tax rate under GST for financial services. Currently, these services are taxed at 15% and the hike in the tax rate means that individuals will have to pay Rs 3 more for every Rs 100 paid for banking transactions.

The Economic Times New Delhi, 13th June 2017

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