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GST alert: Soon, cashbacks to businesses, price benefit to customers for digital transactions; details here

GST alert: Soon, cashbacks to businesses, price benefit to customers for digital transactions; details here

Monday, April 30, 2018 IST

The government is working on a proposal to incentivise digital transactions by providing cashbacks to businesses and price benefits to consumers, a source said.

The government is working on a proposal to incentivise digital transactions by providing cashbacks to businesses and price benefits to consumers, a source said. As per the proposal being worked out by the Revenue Department, consumers paying through the digital mode would be offered a discount over the maximum retail price (MRP). The discount would be capped at Rs 100. Businesses, on the other hand, could get a cashback based on the quantum of turnover through the digital mode.

The proposals to encourage digital transactions are likely to be placed before the GST Council, chaired by Finance Minister Arun Jaitley and comprising state ministers, on May 4. According to the source, the issue of providing incentive for digital transaction was discussed at a meeting held in the Prime Minister’s Office.

During the meeting, three possible modes of incentivising businesses to go in for digital transactions were discussed. Apart from cashbacks, a proposal to allow businesses to obtain tax credit on the basis of turnover obtained through digital mode was also discussed. This would have worked like the input tax credit mechanism wherein businesses can credit for taxes paid on raw materials. Besides, the option of allowing businesses to offset their GST liability up to a threshold for using digital transaction was also deliberated.

Source : https://www.financialexpress.com/economy/gst-alert-soon-cashbacks-to-busine...