CA Nitish Agnihotri
The GST Council, in its 22nd meeting held on October 06, 2017 has recommended following changes to facilitate ease of doing business & trade:
Composition Scheme
1. In order to make it possible for great number of tax payer to avail the benefit of ease of compliance under the composition scheme, it is recommended that turnover limit for availing composition scheme shall be raised from INR 75 lakhs to INR 100 lakhs.
2. Threshold for special category states except the State of Jammu & Kashmir and Uttarakhand shall be raised from INR 50 lakhs to INR 75 lakhs.
3. Threshold for Jammu & Kashmir and Uttarakhand shall be raised to INR 100 lakhs.
4. Composition scheme shall be effective succeeding the month in which application for opting of composition is made.
5. Facility to avail composition scheme, under the increased threshold, shall be available up to March 31, 2018 to both migrated and new taxpayers.
6. New entrants to the scheme shall file GST return in Form GSTR-4 only for the portion of the quarter from when scheme becomes applicable and shall file returns as regular dealers shall be filed for the preceding tax period.
7. Persons who are eligible for availing composition scheme and are providing exempt services, shall be eligible for composition scheme.
Relief for Small and Medium enterprises
1. Exemption to service providers whose annual aggregate turnover is less than INR 20 lakhs (INR 10 lakhs in Special category States except the State of Jammu & Kashmir) from obtaining registration even if they are making inter-state supplies of services.
2. Small and medium business having annual aggregate turnover up to INR 150 lakhs shall be required to file GST returns in Form GSTR-1, 2 & 3 and pay due taxes, on quarterly basis starting from the quarter October to December 2017. The due dates for quarterly returns shall be announced in due course.
3. Registered buyers from such small business would be eligible to avail input tax credit on monthly basis.
4. Reverse charge mechanism as provided under Section 9(4) of the CGST Act, 2017 and Section 5(4) of the IGST Act, 2017 shall be deferred till March 31, 2018 and shall be reviewed by the Committee of Experts.
5. Taxpayers having annual aggregate turnover of INR 150 lakhs, shall not be required to pay tax on receipt of advances on account of supply of goods. GST on such supplies shall be payable only when supply of goods is made.
6. Services provided by the Goods Transport Agency (GTA) to an un-registered person shall be exempt from GST.
Relief for Exporter
1. The held-up refund of IGST paid on goods exported outside India in July 2017 would begin to be paid by October 10, 2017. The August backlog would get cleared from October 18, 2017 and refunds for subsequent months would be handled expeditiously.
2. Other refunds of IGST paid on supplies to SEZs and of inputs taxes on exports under Bond/LUT, shall be processed from October 18, 2017 onwards.
3. Relief is being given by extending the Advance Authorization (AA) / Export Promotion Capital Goods (EPCG) / 100% EOU schemes to sourcing inputs etc. from abroad as well as domestic suppliers. Holders of AA / EPCG and EOUs would not have to pay IGST, Cess etc. on imports.
4. Domestic supplies to holders of AA / EPCG and EOUs would be treated as deemed exports under Section 147 of CGST/SGST Act and refund of tax paid on such supplies given to the supplier.
5. Merchant exporters will now have to pay nominal GST of 0.1% for procuring goods from domestic suppliers for export.
6. Introduction of “e-Wallet” with a notional amount as an advance refund would be made operational w.e.f. 1st April 2018 and can be used to pay taxes.
7. GST rate on sale & purchase of duty scrips under HSN 4907 is being reduced from 5% to 0%.
Reduction in rates
1. Following changes in GST rates for certain Goods & services:
| S. No. |
Tariff item | Description | Present GST Rate |
Recommended GST Rate |
| 1 | 4907 | Duty credit scrips | 5% | Nil |
| 2 | 5401 | Sewing thread of manmade filaments, whether or not put up for retail sale | 18% | 12% |
| 3 | 5402, 5404, 5406 | All synthetic filament yarn, such as nylon, polyester, acrylic, etc. | 18% | 12% |
| 4 | 5403, 5405, 5406 | All artificial filament yarn, such as viscose rayon, Cuprammonium, | 18% | 12% |
| 5 | 5508 | Sewing thread of manmade staple fibres | 18% | 12% |
| 6 | 5509, 5510, 5511 | Yarn of manmade staple fibres | 18% | 12% |
| 7 | 6802 | All goods falling under heading 6802 [other than those of marble and granite or those which attract 12% GST] | 28% | 18% |
2. Sale/supply of vehicles by a registered person, who had procured the vehicle prior to 1st July 2017 and has not availed input tax credit of central excise duty, VAT or any other taxes paid on such vehicles, would be taxed at 65% of the applicable GST + Cess rate. This reduced rate would be applicable for a period of 3 years with effect from 1st July 2017
Other Measures
1. Provisions relating to TDS and TCS shall be deferred till March 31, 2018.
2. System relating to e-way bill to be introduced in a staggered manner effective from January 01, 2018. Such system to be rolled out nationwide with effect from April 01, 2018.
3. Due date to file return in From GSTR-4 by a taxpayer under composition scheme for the quarter ending September 30, 2017 shall be extended up to November 15, 2017.
4. Due date to file return in Form GSTR-6 by an input service distributor (ISD) for the month of July, August and September 2017 shall be extended up to November 15, 2017.
5. Invoicing rules to be modified to provide relief to certain classes of registered persons.
GST council should consider that succeeding months returns should be enabled for submission even in case preceding month returns could not be submitted for any reason. By blocking submission is an harassment as dealer is restricted from clearance of its liability for the month. Council should know that dealers are not criminals.
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