GST Council in its last two meeting which were held within a month has taken some major steps in simplifying, rationalising the law and at the same time providing various much needed reliefs to the assesses.

The Major reliefs /changes / recommendation made by 31st GST Council were as under :

Last Date Extended for availing Input Tax Credit (ITC)  for F.Y. 17-18: ITC in relation to invoices issued by the supplier during FY 2017-18 may be availed by the recipient till the due date for furnishing of FORM GSTR-3B for the month of March, 2019, subject to specified conditions. Now taxpayer has enough time to reconcile its accounts and take the missing credit if any .

Late Fee waived off: there are penal provisions in the law for late filing of various returns. As the late fees is levied on per day basis, the amount runs in thousands in a very short period.   In many cases late filing was due to technical glitches and flaw in the system, so government thought it proper to provide the relief. Late fees shall be completely waived for all taxpayer in case FORM GSTR 1, FORM GSTR 3B and FORM GSTR 4 for period from July 17 to Sep 18 only. And the waiver will be available if returns are furnished after 22nd Dec 2018 but on or before 31st Mar 2018.

However, this will be clear injustice on honest tax payer who though filed late but have already filed their returns by paying huge late fee. Government should give back late fees paid by such tax payer.

Due Date for Filing of Annual Returns extended : a )The due date for furnishing annual return in FORM GSTR 9, FORM GSTR 9A and FORM 9C for F.Y.17-18 shall be further extended till 30th Jun 2019. b) Due date for furnishing FORM GSTR 8 (E-Commerce) of Oct 18 to Dec 18 shall be extended till 31st Jan 2019. c) Due date for furnishing FORM GST ITC-04 (Job-Work) of Jul 17 to Dec 18 shall be extended till 31st Mar 2019.

First setting some unrealistic dates and then extending the same has become the regular habit in GST, which discourages the timely compliance.  This is mainly done because, either GSTIN is not well prepared or there are technical glitches. Before notifying any due date, government should do enough homework and give sufficient time to itself and to tax payer as well. This will save time and energy of  lakhs of assesses and  professionals.

Also, by giving long extension for filing of Annual Return and Audit form to  June 19, doubts are  being raised whether the same will be required at all  or not.

Single Cash Ledge: One more much needed improvement is that there would be a single cash ledger for each tax head. The modalities for implementation would be finalised in consultation with GSTN and the Accounting authorities

Single Authority to Disburse Refund: A welcome recommendation for  scheme of a single authority for disbursement of the refund amount sanctioned by either the Centre or the State tax authorities would be implemented on pilot basis. The modalities for the same shall be finalized shortly.

The Major reliefs /changes / recommendation made by 32nd GST Council are as under :

Increase in Turnover Limit for the existing Composition Scheme: The limit of Annual Turnover in the preceding Financial Year for availing Composition Scheme for Goods shall be increased to Rs 1.5 crore. Special category States would decide, within one week, about the Composition Limit in their respective States.

Compliance under Composition scheme Simplification: The compliance under Composition Scheme shall be simplified as now they would need to file only an Annual Return but Payment of Taxes would remain Quarterly (along with a simple declaration).

Higher Exemption Threshold Limit for Supplier of Goods: There would be two Threshold Limits for exemption from Registration and Payment of GST for the suppliers of Goods i.e. Rs 40 lakhs and Rs 20 lakhs. States would have an option to decide about one of the limits within a weeks’ time. The Threshold for Registration for Service Providers would continue to be Rs 20 lakhs and in case of Special Category States at Rs 10 lakhs. So now there will be two threshold limits one for the Goods and one for the services. What will happen if someone is selling goods as well as providing services ?

Composition   Scheme for Services: A much awaited Composition Scheme shall be made available for Suppliers of Services (or Mixed Suppliers) with a Tax Rate of 6% (3% CGST +3% SGST) having an Annual Turnover in the preceding Financial Year up to Rs 50 lakhs. The said Scheme Shall be applicable to both Service Providers as well as Suppliers of Goods and Services, who are not eligible under the presently available Composition Scheme for Goods. However tax rate of 6% is on much higher side compared to goods, which is only 1%. However service providers providing services directly to consumers, who are unable to  take any benefit of ITC will be benefitted a lot by this provision.  Further they would be liable to file only an Annual Return with Quarterly Payment of Taxes .

All the above decisions of 32nd Council meeting are proposed to  be effective from 1st April ,2019.

Free Accounting and Billing Software shall be provided to Small Taxpayers by GSTN.

Matters referred to Group of Ministers:

1. A seven Member Group of Ministers shall be constituted to examine the proposal of giving a Composition Scheme to Boost the Residential Segment of the Real Estate Sector.

2. A Group of Ministers shall be constituted to examine the GST Rate Structure on Lotteries.

So thanks to aggressive representations by various stake holders and the forth coming elections Government is taking steps to simplify the GST law and making it compliance friendly. There are some stringent steps also which will penalise the non filers of returns heavily such as restriction of generating e-way bill.

A proactive approach towards GST is the need of the hour.  Government , Bureaucracy , Assesses and Consumers everyone will have to respond to it.

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January 2021