Highlights/ Major Recommendations of 22nd GST Council Meeting at New Delhi (dt. 6 Oct. 2017)
Taking note of the widespread unrest among the business community and professionals, Govt and GST Council seems to have taken note of the situation and are all set to sort out concerns of small and medium taxpayers, exporters, etc.
GST Council in it’s 22nd Meeting at New Delhi has recommended certain facilitative changes to ease the burden of compliance on small and medium businesses, like quarterly returns filing by small taxpayers with turnover upto Rs. 1.5 crores, composition threshold increased from 75 lacs to Rs. 1 crore, RCM put on hold till 31 March, 2018, etc., as detailed here-under:
i) Quarterly Return for Small Taxpayers to Reduce Compliance Burden: MSMEs, Small Traders, Exporters, etc. having annual turnover of upto Rs. 1.5 crores have been given relief from monthly filing of GST Returns. Now they can file quarterly GST Returns and also they can pay taxes on quarterly basis.
ii) Review of Threshold Limit for Composition Scheme: Threshold limit for registration under composition scheme has been increased from Rs. 75 lac to Rs. 1 crore. Now small traders having turnover upto Rs. 1 Crore can pay tax at flat rate (1% for traders, 2% for manufacturers and 5% for restaurants) under composition and can file their returns on quarterly basis.
iii) Review of Reverse Charge Mechanism (RCM): For convenience of large taxpayers and survival of unregistered taxpayers, the Reverse Charge Mechanism (RCM) under GST has been put on hold till 31 March 2018.
iv) Relaxations for Exporters: releasing quicker refunds of duties to ease their working capital requirements. Govt has already allowed them to make exports without payment of IGST by furnishing LUT. Refunds for July and August 2017 will be released from 10th Oct./ 18 Oct. 2017 respectively, by cheque.
v) TDS/ TCS: Registration and operationalization of TDS/TCS provisions shall be postponed till 31.03.2018.
vi) Review of GST Rates: In the case of about 27 items of goods and services, the GST rates have been reduced. For details, please refer the link below:
vii) Extension of GST Return Due Dates: The last date for filing the return in FORM GSTR-4/ GST-5A/ GSTR-6 extended upto 15 Nov. 2017.
viii) E-way Bill System: Deferred till 31 March 2018.
ix) No GST on Advance received by Small Taxpayers: No GST on Advance Payments received for Supply of Goods by Small Taxpayers having aggregate annual turnover of upto Rs. 1.5 crores.
x) Inter state services providers exempted from Registration: all inter state service providers shall be exempted from Registration, if turnover remains below the threshold limit.
xi) Services Provided by GTA to Unregistered Person Exempted: The services provided by a GTA to an unregistered person shall be exempted from GST.
xii) Petroleum & Oil Sector: To reduce the cascading of taxes on petrol, diesel, ATF, natural gas and crude oil, following recommendations have been made:
a) Offshore works contract services and associated services relating to oil and gas exploration and production in the offshore areas beyond 12 nautical miles shall attract GST of 12%;
b) Transportation of natural gas through pipeline will attract GST of 5% without input tax credits (ITC) or 12% with full ITC;
c) Import of rigs and ancillary goods imported under lease will be exempted from IGST, subject to payment of appropriate IGST on the supply/import of such lease service and fulfillment of other specified conditions.
Further, GST rate on bunker fuel is to be reduced to 5%, both for foreign going vessels and coastal vessels
xiii) Invoice Rules Simplification: Invoice Rules are being modified to provide relief to certain classes of registered persons.