GST input tax credit: the new discipline
ITC is no longer a compliance reconciliation. It is now an operating discipline, owned by the CFO.
For most of GST's history, input tax credit was treated as a back-office reconciliation. That era is over.
Three years of tightening — on 2B matching, on the reversal mechanism, on the lockout windows — have turned ITC into something closer to a cash discipline. Every rupee of credit blocked is a rupee of working capital lost. Every supplier who fails to file is a leak in the system.
We are increasingly recommending that mid-market companies bring ITC ownership out of the tax department and into the CFO's office. The numbers are material. The controls required are operational, not technical. And the cost of getting it wrong now compounds quietly across every quarter.