Relax / abolish late fee on GST returns

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Dear Sir / Madam,

On behalf of the GST assessee this representation is being made. 


GST law was introduced on 1st July 2017 and assessee have been coming to terms with the new regime. The major teething troubles are:

  • The GST system (website) is slow and unreliable. Its availability is also not assured and long periods of shut down are observed.
  • A large quantum of data and periodicity in which the data is to be furnished is proving to be a challenge as a lot of time is being spent on compliance work and less on business (which is undesirable for the business / government).
  • Lack of adequate software tools and processes at a reasonable price to facilitate better compliances.
  • Infrastructure across the country is inadequate to meet the current demands of the GST system. Most small businesses used to have part-time accounting and in the current requirement adequate trained and GST conversant full-time resources are not available.

Expectation of the assessee:

  1.  The government must treat the assessee as a partner / stakeholder and make way for a win-win situation.
  2. Reduce administrative burden and eliminate fear.
  3.  Eliminate penalties under GST law and switch to an incentive based model for a positive association.

Current issue for which this representation is made:

a)       Late fee is being charged @ the rate of Rs 200 per day on returns when assessee is struggling to file them.

b)      Late fee is charged even on NIL tax returns or returns where the tax amount is quite small e.g. late fee in some cases exceeds the tax or is a high proportion of the tax.

c)       Late fee does not discriminate. For a small tax payer, the amount indicated could be such a large amount that they could even be forced to go out of business while for a large tax payer it may be nothing more than a rounding off item


  • Please do not charge late fee during the stabilisation period of the GST system to any tax payer. This could be at least till 31st March 2018 which can be reviewed thereafter. Stability of the system should be acceptable to the assessee in general and not only the bureaucracy.
  • If at all late fee is to be levied post stabilisation of the GST site, Small and Nil tax payers should have a ceiling on the late fee, say Rs Nil for the first offence and for specific reasons (medical / calamity etc.), maximum Rs. 500 for second offence and subsequent offences at a prescribed rate with a ceiling of Rs. 5000. This should cover all assessee who deposit not more than Rs 10 Lakhs as tax during the year in the ordinary course.
  • Large tax-payers who deposit more than Rs 10 Lakhs a year as GST should be exempt for the first offence and then have a higher late fee charge of Rs 500 per day and limit up to 50% of tax dues as maximum. This is proposed as such tax payers have the resources to comply better and they do not deserve any relaxation


 a)      It will be fair play to all stakeholders

b)      Assessee will be more forthcoming in taking steps for GST compliance

c)       Increase confidence in GST and the government.

What could happen if the government does not take the right steps at this juncture:

a) Faith on the people running the system and the GST system will dip significantly causing national instability.

b) Small scale business may suffer or close down causing large scale unemployment.

c) People may be compelled to resort to agitation or mass non-compliance moves like not filing returns etc.

Hence, a humble appeal is made to the powers that rule our great nation / the people who are change makers to please consider our humble request and take immediate action which will give all of us the strength in our endeavour to jointly make a better nation with an effective GST.