Companies stare at cash flow problems on account of GST credits

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A tweak in the rule on availing goods and services tax (GST) credits may create cash flow problems for some companies starting this month. The change is in the way companies can set off tax paid on raw material against those levied on the goods they sell, which is meant to avoid double counting of taxes.

 According to the credit utilisation mechanism announced late last year, companies can set off their tax liabilities by first utilising their integrated GST (IGST) credits before availing of their central GST (CGST) and state GST (SGST) credits. Previously, companies could set off IGST credits against both CGST and SGST.

Read more at: https://economictimes.indiatimes.com/corporate-news/companies-stare-at-cash-flow-problems-on-account-of-gst-credits/articleshow/68002384.cms