24 Jul 2018Posted By: Mudit Handa


How has 28th GST meet brought cheers for the consumers and traders?

So far, the government has left no stones unturned in strengthening the infrastructure under the GST regime to ensure a conducive and business-friendly environment for all entities and consumers.

 

The GST council in its 28th meeting that was held on 21st July 2018 headed by the Union Minister of Finance, Railways and Coal Sh. Piyush Goyal has again taken a pro-consumerism stance by revealing its groundbreaking economic and fiscal reforms that are indubitably in the interest of the traders and end users.

 

Besides, the GST council has introduced noteworthy reforms as regards GST registration and much-awaited simplification of GST Return Filing procedure so that the business entities all over India can get the utmost boon from the ultra-progressive tax regime.

 

Given below are some key takeaways from the 28th GST Council meeting:

 

#1. What measures has GST council taken for Simplifying the GST Return Filing system?

 

To begin with, the pro-poor measures brought forward the GST meeting, we must discuss the Simplification of the GST Return filing process.

 

  • Threshold limit for Monthly GST returns increased:

The council has now added to it that the taxpayers whose turnover exceeds ₹ 5 crores shall file Monthly GSTR-1. Earlier the threshold limit for filing monthly GSTR-1 was ₹ 1.5 crores. The motive behind this is to enhance the ease of doing business for the small taxpayers.

Currently, there are about 93% of taxpayers whose turnover falls below ₹ 5 crores, who will substantially benefit from this reform.

 

  • Types of GST Returns (Quarterly):

The quarterly return will be different for 2 kinds of the taxpayer:-

Sahaj- For those making B2C supplies only.

Sugam- For those making B2C & B2B supplies.

In these, the details needed to be entered will be less than the regular monthly return.

 

#2. Which goods have witnessed a reduction in GST rates?

Recently, the government had revealed that it will soon work on rationalizing GST Structure by rolling back the 28% GST rate.

It has truly lived up to its word by reducing the GST rates from 28% on many goods. Some of them have been listed below:

 

Reduction in GST from 28% to 18%:

  • Hardware products such as Paints & varnishes, wall putties, resin and cement.

  • Cold storage devices such as refrigerators, freezers, water coolers, ice cream freezers.

  • Domestic electrical appliances such as washing machines, Vacuum cleaners, juicer, mixer and grinders, razors and shavers, hair clippers etc. and Li-ion batteries.

  • Construction & heavy work machineries like crane lorries, fire fighting vehicle, concrete mixer lorries, trucks, Trailers and semi-trailers.

Reduction in GST from 18%, 12%, 5% to Nil:

  • Festive goods like religious idols and rakhis.

  • Sanitary Napkins

  • Sal Leaves, siali leaves and their products

  • Coir pith compost

  • Brooms

Reduction in GST from 18% to 12%:

  • Brass Kerosene Stove,

  • Rubber Rollers

  • Zip & Slide Fasteners

 

Reduction in GST from 18% to 5%:

Ethanol (only for the Oil Marketing Companies for purpose of blending with fuel)

 

#3. What change has been made in case of GST rates of footwear?

The GST rates of footwear have been changed as below-

  • GST @ 5% has been imposed on footwear costing up to ₹ 1,000/-.

  • For footwear costing above ₹ 1,000/-, GST @ 18% has been imposed.

 

#4. Which handicrafts have items witnessed a reduction in GST rates?

In the interest of the artisans and handicraft traders, the GST council has brought down the rates of GST in case of handicrafts goods, as follows-

From 28% to 18%:

  • Handbags, pouches and purses; jewellery boxes,

  • Wooden frames for painting and photographs etc

  • Cork art ware

  • Wooden art ware

  • Glass statues & art ware

  • Handcrafted  lamps

From 12% to 5%:

  • Handwoven carpets and tapestries

  • Laces and torans.

 

#5. What change has been made with regard to Accumulated ITC Refund of textile manufacturers?

The council has brought out a major change in respect of Refund of accumulated input credit on account of inverted tax structure in case of textile manufacturers.

It has been noticed that fabrics attract GST @ 5%, but the textile manufacturers could not avail the input credit, nor were allowed to claim a refund of accumulated ITC. The GST council has now decided to allow the refund of accumulated GST input in case of fabrics on account of inverted tax structure.  

 

#6. Which services have witnessed a reduction in GST rates?

It is to be noted very carefully that the GST council has extended notable reliefs à propos GST rates in the following categories of services:

  • Agriculture and food processing industry,

  • Education, training & skill development

  • Pension, old age and social security support

  • A worthwhile relief has been given in Hotel business by the way of applying GST rate on lodge service on the basis of transactional value instead of declared tariff of 18%, as was imposed earlier.

  • Services provided in banking and IT sectors by an establishment of an individual in India to an establishment of that person abroad (i.e.related party) have been exempted from GST.

  • to get complete information on changes in GST rates on services .

 

#7. What reforms have been introduced in respect of GST registration?

The GST council has recommended certain amendments in the CGST Act, IGST Act, UTGST Act and the GST (Compensation to States) Act, wherein certain reforms in respect of GST registration have been made as below-

 

  • The threshold limit for new GST registration in the North-East States of Assam, Arunachal Pradesh, Himachal Pradesh, Meghalaya, Sikkim and Uttarakhand will be increased from ₹ 10 Lakhs to ₹20 Lakhs.

 

  • As per an amendment in UTGST Act, more than one GST registration in India to be allowed within a State/Union territory with respect to multiple business addresses within that State/Union territory.

 

  • GST registration will be mandatory for only all e-commerce operators who are needed to collect tax at source (TCS).

 

  • As of now, after the cancellation of GST registration, the GST liability would hitherto keep on accumulating till cancellation of GST certificate. Henceforth, no liability shall arise once you have applied for cancellation of GST registration as GST certificate shall be suspended immediately.

 

#8. How much has been threshold limit for GST composition scheme raised?

The threshold limit of turnover for GST registration process under composition scheme to be raised from ₹ 1 crore to ₹ 1.5 crores.

 

#9. What provision is there for the reverse charge under GST?

The government had suggested a complete rollback of the reverse charge mechanism. However, GST on receipt of supplies from unregistered suppliers, under the reverse charge shall continue only for specified goods.  

 

#10. Which amendment has been made in respect of the claim of input credit?

As was proposed recently, the council has made amendment to section 16(2) of CGST Act 2017, wherein if a person fails to settle the GST Liability within 180 days from the date of issue of invoice for the goods & services, the input credit claimed by that person shall be added to his output tax liability. However, the interest liability has been removed from this section.

#11. What if a dispute arises between persons located in different State/Union territories?

As per the recent amendment, recovery can now be made from different persons, even if they are present in different State or Union territories.

 

#12. How shall Supply of services from abroad be treated?

Supply of services shall be now treated as exports even if their payment has been received in Indian Rupees on the permission of Reserve Bank of India.

 

If you need any other assistance related to GST registration in India or GST return filing online, feel free to contact us at 8881-069-069.

 

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