The GST Council, in its 22nd Meeting which was held today in the national capital under Chairmanship of the Union Minister of Finance and Corporate Affairs, Shri Arun Jaitley has recommended the following facilitative changes to ease the burden of compliance on small and medium businesses:

  • Composition Scheme has been extended to taxpayers having annual aggregate turnover of up to Rs. 1 crore.
  • Under composite scheme traders, restaurants & manufacturers will pay 1% , 5% & 2% respectively.
  • A Group of Ministers (GoM) will be constituted soon to examine measures to make the composition scheme more attractive.
  • Quarterly returns for taxpayers with annual turnover less than ₹1.5 crores; Tax also to be paid on Quarterly basis.
  • This threshold of turnover for special category States, except J & K and Uttarakhand, has been increased to Rs. 75 lacs from Rs. 50 lacs.
  • GST Council has considered the implementation experience of the last 3 months & gave relief to small traders in the  GST.
  • The Current turnover threshold limit under the Composition Scheme was of Rs. 75 lacs which has now been raised to Rs. 1 Crore.
  • Composition Scheme has been extended to taxpayers having annual aggregate turnover of up to Rs. 1 crore.
  • E-way bill provisions deferred till April 2018;
  • Reverse charge to be abolished till 31 March
  • Within the next 4 days i.e. by 10.10.2017 the held-up refund of IGST paid on goods exported outside India in July would begin to be paid.
  • The August backlog would get cleared from 18.10.2017 and refunds for subsequent months would be handled expeditiously.
  • Other refunds of IGST paid on supplies to SEZs and of inputs taxes on exports under Bond/LUT, shall be processed from 18.10.2017 onwards.
  • Exporters have been exempted from furnishing Bond and Bank Guarantee when they clear goods for export.
  • Immediate relief to be given by extending the Advance Authorization / EPCG/ 100% EOU schemes to sourcing inputs 4m abroad & domestic suppliers
  • Merchant exporters will now have to pay nominal GST of 0.1% for procuring goods from domestic suppliers for export.
  • The permanent solution to cash blockage is that of “e-Wallet” which would be credited with a notional amount as if it is an advance refund.
  • E wallet shall be used for advance refund. This would help exporters in furthering their business.

Krishan Arora, Partner, Grant Thornton India LLP said that “Amidst strong representations from trade and industry on the hardships faced due to the overall GST compliance framework, much needed interim measures announced to aid assessees. Quarterly filings for taxpayers under INR 1.5 crore turnover and increasing composition scheme limit to INR 1 crore would surely be a relief for small dealers who  were grappling with increased compliance burden. Deferment of e-way bill requirements and applicability of reverse charge requirements on unregistered supplies should also provide relief to industry in focussing on routine business and plan their overall GST compliance framework more efficiently.”

Biren Vyas, Partner, Grant Thornton India LLP on the GST Council meeting sais that “In recent announcements in 22nd meeting, GST Council has announced procedural relief like deferring reverse charge mechanism and e-way bills, filing of quarterly returns for small enterprises, increase in threshold limit for composition scheme and has also announced working capital related relief for exporters. Further, rate reduction for identified necessary products and services like food, textile and works contract would an overall basis help in generating more positive view towards GST implemented in India.”

22nd GST Council Meeting

 Composition Scheme

1. The composition scheme shall be made available to taxpayers having annual aggregate turnover of up to Rs. 1 crore as compared to the current turnover threshold of Rs. 75 lacs. This threshold of turnover for special category States, except Jammu & Kashmir and Uttarakhand, shall be increased to Rs. 75 lacs from Rs. 50 lacs.The turnover threshold for Jammu & Kashmir and Uttarakhand shall be Rs. 1 crore. The facility of availing composition under the increased threshold shall be available to both migrated and new taxpayers up to 31.03.2018. The option once exercised shall become operational from the first day of the month immediately succeeding the month in which the option to avail the composition scheme is exercised. New entrants to this scheme shall have to file the return in FORM GSTR-4 only for that portion of the quarter from when the scheme becomes operational and shall file returns as a normal taxpayer for the preceding tax period. The increase in the turnover threshold will make it possible for greater number of taxpayers to avail the benefit of easier compliance under the composition scheme and is expected to greatly benefit the MSME sector.

2. Persons who are otherwise eligible for composition scheme but are providing any exempt service (such as extending deposits to banks for which interest is being received) were being considered ineligible for the said scheme. It has been decided that such persons who are otherwise eligible for availing the composition scheme and are providing any exempt service, shall be eligible for the composition scheme.

3. A Group of Ministers (GoM) shall be constituted to examine measures to make the composition scheme more attractive.

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 Relief for Small and Medium Enterprises

4. Presently, anyone making inter-state taxable supplies, except inter-State job worker, is compulsorily required to register, irrespective of turnover.  It has now been decided to exempt those service providers whose annual aggregate turnover is less than Rs. 20 lacs (Rs. 10 lacs in special category states except J & K) from obtaining registration even if they are making inter-State taxable supplies of services. This measure is expected to significantly reduce the compliance cost of small service providers.

5. To facilitate the ease of payment and return filing for small and medium businesses with annual aggregate turnover up to Rs. 1.5 crores, it has been decided that such taxpayers shall be required to file quarterly returns in FORM GSTR-1,2 & 3 and pay taxes only on a quarterly basis, starting from the Third Quarter of this Financial Year i.e. October-December, 2017. The registered buyers from such small taxpayers would be eligible to avail ITC on a monthly basis. The due dates for filing the quarterly returns for such taxpayers shall be announced in due course. Meanwhile, all taxpayers will be required to file FORM GSTR-3B on a monthly basis till December, 2017. All taxpayers are also required to file FORM GSTR-1, 2 & 3 for the months of July, August and September, 2017. Due dates for filing the returns for the month of July, 2017 have already been announced. The due dates for the months of August and September, 2017 will be announced in due course.

6. The reverse charge mechanism under sub-section (4) of section 9 of the CGST Act, 2017 and under sub-section (4) of section 5 of the IGST Act, 2017 shall be suspended till 31.03.2018 and will be reviewed by a committee of experts. This will benefit small businesses and substantially reduce compliance costs.

7. The requirement to pay GST on advances received is also proving to be burdensome for small dealers and manufacturers. In order to mitigate their inconvenience on this account, it has been decided that taxpayers having annual aggregate turnover up to Rs. 1.5 crores shall not be required to pay GST at the time of receipt of advances on account of supply of goods. The GST on such supplies shall be payable only when the supply of goods is made.

8. It has come to light that Goods Transport Agencies (GTAs) are not willing to provide services to unregistered persons. In order to remove the hardship being faced by small unregistered businesses on this account, the services provided by a GTA to an unregistered person shall be exempted from GST.

Other Facilitation Measures

9. After assessing the readiness of the trade, industry and Government departments, it has been decided that registration and operationalization of TDS/TCS provisions shall be postponed till 31.03.2018.

10. The e-way bill system shall be introduced in a staggered manner with effect from 01.01.2018 and shall be rolled out nationwide with effect from 01.04.2018. This isin order to give trade and industry more time to acclimatize itself with the GST regime.

11. The last date for filing the return in FORM GSTR-4 by a taxpayer under composition scheme for the quarter July-September, 2017 shall be extended to 15.11.2017. Also, the last date for filing the return in FORM GSTR-6 by an input service distributor for the months of July, August and September, 2017 shall be extended to 15.11.2017.

12. Invoice Rules are being modified to provide relief to certain classes of registered persons.

Other Related Government Press Releases

Change in GST Rate on Services / Job Work approved by GST Council

8 Relief Measure approved for exporters by GST Council

Govt reduces GST rate on 28 type of goods and provided IGST exemption on few goods

More Under Goods and Services Tax

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Tags : goods and services tax (3378) GST (2967) GST Council (74)

16 responses to “12 decisions taken by GST Council for Small and Medium Enterprises”

  1. sreenivasa says:

    so much has been discussed and views expressed on the limit of T.O and related issue. How about service providers like CAs, CS, having Rs.20 lakhs receipts and above
    Won`t they also need a sympathetic consideration? Are they not human beings?
    Just think, think……..

  2. MAHESH says:

    AAPKE OPERATION TO WEEKLY HI HOGE (4 RETURN IN 1 MONTH) WO HI LAGATAR 3 MAHINE.USKE BAD AAPKO TABLETS KI DOSE KAM KAR DEGE

  3. Debdas Mitra says:

    Wrongly submitted GSTR-3B for July & August,2017 be given scope to be rectified.

  4. PRABHAKAR says:

    We can welcome these relaxations, but it seems they have not taken any major changes regarding filing the returns. For ex. GSTR 1,2 and 3 are yet to be opened. In case of August month it is showing TUB which means I think to be updated, and the same shows the hasty decision of implementing gst even without forms ready.
    They are concentrating only on 3B because it gives revenue. Even that 3B also stupendous at the stage of submit. IT will not guide how much tax to be paid and how much to offset liability etc. Those items will be shown only after you submit the return which can not be rectified or revised for the mistakes done. They say it can be rectified automatically after filing of GSTR 1 2 and 3 which are not open still. I suggest that payment of tax and offsetting the liability should be shifted to prior stage of submit. Even after filing the revision option to be made available, because, I think atleast 50% of dealers might have done mistakes in submitting 3B and not able to file the return. Please make sure that the GST portal and software are flawless and customer friendly.
    Also one more suggestion , while billing why cannot they make it to bill in the website itself like e way bill so that matching concept of ITC between the supplier and customer can be very much easy, also it ensures that entire billing of business community is genuine and no room for no. 2 billing. When billing stage itself is 100% genuine the revenue automatically generates,
    with that effect the higher end slab rates like 28% etc can be conveniently reduced and the public also will be benefited .

  5. Vijay Kumar says:

    Still, people are groping in the dark. Why file returns of July, August and September? They should be filed in October end and taxes paid accordingly m, that is after three months.
    1. Composite Scheme-Should be for all across the board, whatever the party’s business, whether supply, or job work or services, or any thing else should be covered under Composite scheme. These people below 1.5 crore turn over should be treated as small dealers/suppliers/service providers etc. The flat tax of 2 % should be levied on all such businesses, barring those below thresh hold limit.
    2. Job Workers, having nothing to do, are required to pay GST, and get the payment of the GST only when they get the payment. Most of the cases, this period is 90 to 120 days. This means that the 18% GST paid by them will be paid by these job workers, who earn around 8%, will come back to them after 120 days. The GST on Job Work should be abolished completely. However to keep the check on willful defaulters, after one year of the material supply for Job Work, there should be some penal provision.
    3. Registered dealers should be required to pay the GST after 45 days of the close of the month, as per their Bills. The Super Computers of the GST department should make a refund of the Inward GST credit, within 15 days of the close of the quarter, in the dealers account. This would really make things simpler.
    4. Registered dealer should be required to file only one GSTR-1 type return, small people quarterly, pay tax accordingly every quarter. For large dealers, payment may be every month to Department, as was in Excise, VAT etc.

  6. CA. S.C.Podder says:

    Don’t try to copy pest, please take care the advises given by Indirect expert and industrial bodies for successful implementation of GST.
    This is nothing but forthcoming Election stunt ;
    How the GST council are committed / experts addressed in 22nd council meeting :
    point no. 4 “Tax to be paid on monthly basis” while, as per descriptive point no. 5 “Pay taxes only on quarterly basis” and even press release it is written that taxes has to be paid on quarterly basis.
    So, give explanation for it that I am wrong or…..???

    • TG Team says:

      Sir,

      That was a mistake on our part, which we have rectified now. Thanks for bringing the same to our attention.

  7. GIRISH says:

    BY WHICH TIME THE CHANGES WILL COME IN TO FORCE, MEANS HOW MUCH TIME IT WILL TAKE TO NOTIFY THE SAME

  8. Mukesh Parmar says:

    Namaste ~ 3 Months old Good & Service Tax has seen so many changes, may be complex to compile them all.
    It is a request to the GST Committee, Finance Minister, Revenue Secretary and Prime Minister and all in the GST Team ~ “to spend some fruitful time to really make this Good & Simple Tax, by repelling many un wanted provisions just borrowed from the earlier acts. Simplify your software in tendum with the software developers, GST Team and accounting experts to make it simple.
    Many experts can express their opinion in this direction to help simplify the tax. Already not much time has been lost and is not too late to do so. This will give a stable platform for GST and Business to move hand in hand with ease.
    GST in reality has not faced any new problems. They were already existing, but were not looked into at the implementation of GST ~ only a simple copy and paste from the old laws that have been subsumed. Spent some quality time to look into it and do the needful.
    We have many many experts to aid here, why not lend them a hearing ear instead of bringing changes in piece meals and making it complex. Take 1 or 2 months and address the issues, instead of postponing and reviewing it bit by bit. Let the GSTR3B be used to collect monthly revenue.

    E Way bill is not required when there is GST Tax Invoice, which itself is like a e way bill. Save time on this with consensus from all states.

    There are many simple suggestion to tackle many many issues with consensus. Let us take a step forward in this direction.

    Thanking you all.

  9. Hemanshu7649 says:

    Form 3B should also have been filed on quarterly basis. Overall, it is a good changes in GST through which it will be helpful to running the business smoothly.

  10. keshav m dixit says:

    Sir Very good decision taken by Honorable Minister. but not clear that….”taxpayers will be required to file FORM GSTR-3B on a monthly basis till December, 2017. It should have been quarterly.

  11. CA DARSHAN PIPLANI says:

    SOME IMPOSTENT DECISIONS HAVE NOT BEEN TAKEN:-
    (1) SOME ASSESSEE HAS BEEN REGISTERED IN GST INSTEAD OF COMPOSITION SCHEME.
    (2) CHANGE IN DETAILS OF THE ASSESSEE SUCH AS ADDRESS ETC.
    (3) SITE IS NOT WORKING PROPERLY.
    (4) LATE FEE SHOULD BE ABOLISHED AT LEAST FOR ONE YEAR.
    OPTIONS SHOULD BE GIVEN EMMEDIATELY FOR RECTIFICATION OF ABOVE DEFECTS.
    REGARDS

    • GIRISH says:

      SIR,

      LATE FEES CHARGE, SHOWS GOVERNMENT VERY NERRO MENTALITY, IF A PERSON CONTINUESLY MAKING DELAY CAN BE SHOWCAUSE FOR THE SAME.

  12. Mohana Rao says:

    Sir,

    in your detailed information you mentioned that, medium and small enterprises are should file returns in quarterly and tax to be paid in quarterly . but taxes should be paid on monthly basis. please correct it.

  13. Jitendra says:

    In this article, as per small point no. 4 “Tax to be paid on monthly basis” while, as per descriptive point no. 5 “Pay taxes only on quarterly basis” and even press release it is written that taxes has to be paid on quarterly basis.
    So, give explanation for it that I am wrong or…..???

  14. Parveen Bansal says:

    Tax to be paid on Quarterly basis for taxpayer covered under Quarterly return subject to clarification on 3B

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