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July 1, 2022, marked the completion of five years of India’s ambitious Goods and Services Tax (GST) law. The same week also witnessed the 47th GST Council meeting scheduled at Chandigarh for two days- the 28th and 29th of June 2022.

GSTR-3B amendments to be allowed

GST Council allowed amendments in GSTR-3B (Monthly GST return for taxpayers). Further, it permitted auto-population of most details in Form GSTR-3B and annual returns in Form GSTR-9 for better compliance and ease in compliance. The Council was clear that the new GST return system would be withdrawn as it is no longer relevant. A proposal for comprehensive alterations in GSTR-3B will be placed before the public for seeking input.

GSTR-9 to continue with some relaxations

Annual returns for FY 2021-22 may be notified with minimal changes.

  • It shall continue to apply with some relaxations and modifications.
  • GSTR-9 and GSTR-9A continue to not be applicable to those with threshold turnover below Rs.2 crore for FY 2021-22.
  • The limitation under Section 73 of the CGST Act for FY 2017-18 for issuance of orders relating to demands linked with the due date of annual return, is extended till 30th September 2023.

Relief to e-commerce suppliers

  • GST Council agreed to ease compliance bottlenecks for e-commerce suppliers.
  • It allowed the e-commerce suppliers to register under the composition scheme for intrastate supplies easing their registration hassles and for reducing tax outgo.
  • The new composition scheme for e-commerce suppliers for intrastate online sales will be implemented on 1st Jan 2023 once the IT system is set up.
  • It means that such intrastate e-commerce suppliers will no longer need to obtain mandatory GST registration if their turnover does not exceed the limit of Rs.40 lakh (goods) or Rs.20 lakh (services) or such lower limits defined for some states/UTs.
  • Interstate suppliers on e-commerce platforms shall have to obtain registration irrespective of turnover, compulsorily.

Deadline extensions to composition taxpayers

  • GSTR-4 for FY 2021-22 to get a waiver of late fee for filing up to 28th July 2022 as against earlier extension of up to 30th June 2022.
  • CMP-08 deadline for Apr-Jun 2022 (Q1 of FY 2022-23) to get an extension up to 30th July 2022 from 18th July 2022.
  • Pruning of GST Rate and Exemption List
  • The GST Council accepted the interim report of GoM on rate rationalisation
    in totality and most of the recommendations by the Fitment Committee.
  • Correction of Inverted tax structure
Description of goods or services Old Rate New Rate
Solar water heaters and systems 5% 12%
Prepared or finished leather or chamois leather or composition leathers 5% 12%
Job work for processing of hides, skins, leather, making of leather products including footwear, and clay brick manufacturing 5% 12%
Earthwork works contracts and sub-contracts to the Central and state governments, Union Territories and local authorities 5% 12%
Pawan Chakki being air-based atta chakki, wet grinder, cleaning, sorting or grading machines for seeds and grain pulses, and milling machines or cereal making machines, etc; 5% 18%
Ink for drawing, printing, and writing 12% 18%
Knives with paper knives, cutting blades, pencil sharpeners and its blades, skimmers, cake-servers, spoons, forks, ladles, etc 12% 18%
Centrifugal pumps, submersible pumps deep tube-well turbine pumps, bicycle pumps that are power-driven mainly for handling water 12% 18%
Milking machines and dairy machinery, cleaning, sorting or grading machines and its parts for eggs, fruit or other agri produce 12% 18%
Lights and fixture, LED lamps, their metal printed circuits board 12% 18%
Marking out and drawing instruments 12% 18%
Services by foreman to chit fund 12% 18%
Works contract for railways, metro, roads, bridges, effluent treatment plant, crematorium, etc. 12% 18%
Works contract and sub-contract to the Central and state governments, local authorities for canals, dams, pipelines, plants for water supply, historical monuments, educational institutions, hospitals, etc 12% 18%
Refund of accumulated ITC for edible oils and coal is disallowed.
*The rates will come into effect from 18th July 2022 subject to CBIC notification
  • GST rate hikes and cuts
Description of goods or services Old Rate New Rate
What’s costlier
Cut and Polished diamonds 0.25% 1.50%
Tetra Pack (Aseptic Packaging Paper) 12% 18%
Tar (From coal, or coal gasification plants, or producer gas plants and coke oven plants) 5%/18% 18%
What’s cheaper
Import of tablets called Diethylcarbamazine (DEC) free of cost for National Filariasis Elimination Programme (IGST) 5% Nil
Import of particular defence items by private businesses or suppliers for end-consumption of Defence (IGST) Applicable rates Nil
Ostomy Appliances 12% 5%
Orthopedic appliances such as intraocular lens, artificial parts of the body, splints and other fracture appliances, other appliances which are worn or carried, or body implants, to compensate for a defect or disability 12% 5%
Transport of goods and passengers by ropeways (with ITC of services) 18% 5%
Renting of truck or goods carriage including the fuel cost 18% 12%
*The rates will come into effect from 18th July 2022 subject to CBIC notification
  • Pruning of GST exemptions
Description of goods or services Old Rate New Rate
Earlier fully exempted, now withdrawn
Maps and hydrographic or similar charts of all kinds, including atlases, wall maps, topographical plans and globes, printed Nil 12%
Cheques, lose or in book form Nil 18%
Parts of goods of heading 8801 Nil 18%
Air transportation of passengers to and from north-eastern states and Bagdogra now restricted to economy class Nil Condition added
Transportation by rail or a vessel of railway equipment and material, storage or warehousing of commodities attracting tax such as copra, nuts, spices, jaggery, cotton, etc, fumigation in a warehouse of agri produce, services by RBI, IRDA, SEBI, FSSAI, and GSTN, renting of residential dwelling to GST-registered businesses, and services by the cord blood banks for preserving stem cells Nil Applicable rate
Room rent (excluding ICU) exceeding Rs.5,000 per patient day taxed without ITC Nil 5%
Common bio-medical waste treatment facilities for treating or disposing biomedical waste shall be taxed with availability of ITC, like CETPs Nil 12%
Hotel accommodation priced up to Rs.1,000 per day Nil 12%
Training or coaching in recreational activities on arts or culture, or sports other than by individuals Nil Applicable rate
Earlier partially exempted, now withdrawn
Petroleum/ Coal bed methane 5% 12%
e-Waste 5% 18%
Scientific and technical instruments to public funded research institutes 5% Applicable rate
*The rates will come into effect from 18th July 2022 subject to CBIC notification

Readers may go through with complete press release for detailed analysis.

 

Author Bio

CA. Chetan Agarwal is a Fellow Chartered Accountant and Cleared his CA Final in 1st Attempt and became member of Indian Institute of Chartered Accountants in Aug, 2011. He started his journey of experience with M/s Indian Oil Corporation Limited, a fortune 500 Company and Maharatna Company of Govern View Full Profile

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