Recommendations made by the GST Council in its 22nd Meeting held today under Chairmanship of the Union Minister of Finance and Corporate Affairs, Shri Arun Jaitley in the national capital.
The GST Council, in its 22nd Meeting which was held today in the national capital under Chairmanship of the Union Minister of Finance and Corporate Affairs, Shri Arun Jaitley has recommended the following facilitative changes to ease the burden of compliance on small and medium businesses:
- The composition scheme shall be made available to taxpayers having annual aggregate turnover of up to Rs. 1 crore as compared to the current turnover threshold of Rs. 75 lacs. This threshold of turnover for special category States, except Jammu & Kashmir and Uttarakhand, shall be increased to Rs. 75 lacs from Rs. 50 lacs.The turnover threshold for Jammu & Kashmir and Uttarakhand shall be Rs. 1 crore. The facility of availing composition under the increased threshold shall be available to both migrated and new taxpayers up to 31.03.2018. The option once exercised shall become operational from the first day of the month immediately succeeding the month in which the option to avail the composition scheme is exercised. New entrants to this scheme shall have to file the return in FORM GSTR-4 only for that portion of the quarter from when the scheme becomes operational and shall file returns as a normal taxpayer for the preceding tax period. The increase in the turnover threshold will make it possible for greater number of taxpayers to avail the benefit of easier compliance under the composition scheme and is expected to greatly benefit the MSME sector.
- Persons who are otherwise eligible for composition scheme but are providing any exempt service (such as extending deposits to banks for which interest is being received) were being considered ineligible for the said scheme. It has been decided that such persons who are otherwise eligible for availing the composition scheme and are providing any exempt service, shall be eligible for the composition scheme.
- A Group of Ministers (GoM) shall be constituted to examine measures to make the composition scheme more attractive.
Relief for Small and Medium Enterprises
- Presently, anyone making inter-state taxable supplies, except inter-State job worker, is compulsorily required to register, irrespective of turnover. It has now been decided to exempt those service providers whose annual aggregate turnover is less than Rs. 20 lacs (Rs. 10 lacs in special category states except J & K) from obtaining registration even if they are making inter-State taxable supplies of services. This measure is expected to significantly reduce the compliance cost of small service providers.
- To facilitate the ease of payment and return filing for small and medium businesses with annual aggregate turnover up to Rs. 1.5 crores, it has been decided that such taxpayers shall be required to file quarterly returns in FORM GSTR-1,2 & 3 and pay taxesonly on a quarterly basis, starting from the Third Quarter of this Financial Year i.e. October-December, 2017. The registered buyers from such small taxpayers would be eligible to avail ITC on a monthly basis. The due dates for filing the quarterly returns for such taxpayers shall be announced in due course. Meanwhile, all taxpayers will be required to file FORM GSTR-3B on a monthly basis till December, 2017. All taxpayers are also required to file FORM GSTR-1, 2 & 3 for the months of July, August and September, 2017. Due dates for filing the returns for the month of July, 2017 have already been announced. The due dates for the months of August and September, 2017 will be announced in due course.
- The reverse charge mechanism under sub-section (4) of section 9 of the CGST Act, 2017 and under sub-section (4) of section 5 of the IGST Act, 2017 shall be suspended till 31.03.2018 and will be reviewed by a committee of experts. This will benefit small businesses and substantially reduce compliance costs.
- The requirement to pay GST on advances received is also proving to be burdensome for small dealers and manufacturers. In order to mitigate their inconvenience on this account, it has been decided that taxpayers having annual aggregate turnover up to Rs. 1.5 crores shall not be required to pay GST at the time of receipt of advances on account of supply of goods. The GST on such supplies shall be payable only when the supply of goods is made.
- It has come to light that Goods Transport Agencies (GTAs) are not willing to provide services to unregistered persons. In order to remove the hardship being faced by small unregistered businesses on this account, the services provided by a GTA to an unregistered person shall be exempted from GST.
Other Facilitation Measures
- After assessing the readiness of the trade, industry and Government departments, it has been decided that registration and operationalization of TDS/TCS provisions shall be postponed till 31.03.2018.
- The e-way bill system shall be introduced in a staggered manner with effect from 01.01.2018 and shall be rolled out nationwide with effect from 01.04.2018. This isin order to give trade and industry more time to acclimatize itself with the GST regime.
- The last date for filing the return in FORM GSTR-4 by a taxpayer under composition scheme for the quarter July-September, 2017 shall be extended to 15.11.2017. Also, the last date for filing the return in FORM GSTR-6 by an input service distributor for the months of July, August and September, 2017 shall be extended to 15.11.2017.
- Invoice Rules are being modified to provide relief to certain classes of registered persons.
(Release ID :171466)
Changes in GST Rates for Goods and IGST Rates on Imports of Goods
As per discussions held in the 22nd GST Council Meeting held under Chairmanship of Union Finance Minister Shri Arun Jaitley on 6th October, 2017, the following changes in GST rates for certain Goods and IGST rates on Imports of specified Goods have been recommended.
- GST RATE FOR FOLLOWING GOODS HAVE BEEN REDUCED
|Description||Present GST Rate||GST Rate Recommended by the GST Council|
|1.||0804||Mangoes sliced dried||12%||5%|
|1905 or 2106||Khakra and plain chapati / roti||12%||5%|
|3.||19 or 21
|Food preparations put up in unit containers and intended for free distribution to economically weaker sections of the society under a programme dulyapproved by the Central Government or any State Government, subject to specified conditions [Foot note 1]||18%
|4.||21||Namkeens other than those put up in unit container and, –
(a) bearing a registered brand name; or
(b) bearing a brand name on which an actionable claim or enforceable right in a court of law is available [other than those where any actionable claim or enforceable right in respect of such brand name has been foregone voluntarily
[Foot note 2]
|5.||2710||Imposing GST only on the net quantity of superior kerosene oil [SKO] retained for the manufacture of Linear Alkyl Benzene [LAB]||18%||18%
[Clarification to be issued]
|6.||30||Ayurvedic, Unani, Siddha, Homeopathy medicines, other than those bearing a brand name
[Foot note 3]
|8.||3407||Modelling paste for children amusement||28%||18%|
|9.||3915||Plastic waste, parings or scrap||18%||5%|
|10.||4004 00 00||Rubber waste, parings or scrap||18%||5%|
|11.||4017 00 20||Hard Rubber waste or scrap||28%||5%|
|12.||4707||Paper waste or scrap||12%||5%|
|13.||4907||Duty credit scrips||5%||Nil|
|14.||5401||Sewing thread of manmade filaments, whether or not put up for retail sale
|15.||5402, 5404, 5406||All synthetic filament yarn, such as nylon, polyester, acrylic, etc.
|16.||5403, 5405, 5406
|All artificial filament yarn, such as viscose rayon, Cuprammonium,||18%||12%|
|17.||5508||Sewing thread of manmade staple fibres
|18.||5509, 5510, 5511||Yarn of manmade staple fibres||18%||12%|
|All goods falling under heading 6802 [other than those of marble and granite or those which attract 12% GST]||28%||18%|
|21.||7001||Cullet or other waste or scrap of Glass
|22.||8305||Fittings for loose-leaf binders or files, letter clips, letter corners, paper clips, indexing tags and similar office articles, of base metal; staples in strips (for example, for offices, upholstery, packaging), of base metal
|23.||8483||Plain Shaft Bearing 8483||28%||18%|
|24.||84||Parts suitable for use solely or principally with fixed Speed Diesel Engines of power not exceeding 15HP
|25.||84 or 85||Parts suitable for use solely or principally with power driven pumps primarily designed for handling water, namely, centrifugal pumps (horizontal and vertical), deep tube-well turbine pumps, submersible pumps, axial flow and mixed flow vertical pumps||28%||18%|
|26.||84 or 85||E-Waste||28%/18%||5%|
|27.||Any Chapter||Biomass briquettes||18%||5%|
- Reduction in GST rate against S. No 4 above is subject to following condition:
- a)If the supplier of such food preparations produces a certificate from an officer not below the rank of the Deputy Secretary to the Government of India or not below the rank of the Deputy Secretary to the State Government concerned to the effect that such food preparations have been distributed free to the economically weaker sections of the society under a programme duly approved by the Central Government or the State Government concerned, within five months from the date of supply of such goods or within such further period as the jurisdictional Commissioner of Central tax or jurisdictional Commissioner of State tax, as the case maybe, may allow in this regard.
- For S. No.5 above, the phrase registered brand name means:
- a)A brand registered as on 15.05.2017 shall be deemed to be a registered brand for the purposes of levy of 5% GST, irrespective of whether or not such brand is subsequently deregistered.
- b)A brand registered as on 15.05.2017 under the Copyright Act, 1957 shall also be treated as a registered brand for the purposes of levy of 5% GST.
- c)A brand registered as on 15.05.2017 under any law for the time being in force in any other country shall also be deemed to be a registered brand for the purposes of levy of 5% GST.
- For S. No. 7 above, the phrase “brand name” is defined as:
“brand name” or “trade name” means a brand name or a trade name, whether registered or not, that is to say, a name or a mark, such as symbol, monogram, label, signature or invented word or writing which is used in relation to such specified goods for the purpose of indicating, or so as to indicate a connection in the course of trade between such specified goods and some person using such name or mark with or without any indication of the identity of that person.
- IGST EXEMPTION ON IMPORTS OF GOODS:
|S. No||Description||Present applicable IGST rate||Recommended IGST rate|
|1||IGST exemption on imports of rigs imported for oil / gas exploration and production projects under lease, subject to the following conditions that:
(i) Integrated tax leviable under section 5(1) of the IGST Act, 2017 on supply of service covered by item 1(b) or 5(f) of Schedule II of the Central Goods and Services Tax Act, 2017;
(ii) The rig is not sold without the prior permission of the Commissioner of Customs of the port of importation;
(iii) to re-export the goods within 3 months from the expiry of the period for which they were supplied under a transaction covered by item 1(b) or 5(f) of Schedule II of the Central Goods and Services Tax Act, 2017 out of India;
(iv) to pay on demand an amount equal to the integrated tax payable on the said goods but for the exemption under this notification in the event of violation of any of the above conditions and applicable interest.
|2||Exemption from IGST on imports of medicines supplied free by international agencies like UNICEF, WHO, Red Cross etc.
|3||A. Exemption from IGST on imports of bona fide gifts upto CIF value limit of Rs. 5000 imported through post or air.
(Release ID :171467)