Change in GST Rate on Goods – 

Solar Power Plants to be Taxed at 8.9%

To provide some relief to Solar Industry, it has been decided that supply of Solar Power Systems/ Plants as a part of EPC Contract will be taxed as follows –

Particulars Effective Rate
70% of Value @5% GST 3.50%
30% of Value @18% GST 5.40%
Effective Rate of GST 8.90%

Fly ash Blocks will also be taxable @5% at par with Fly Ash Bricks. The rate of only fly ash bricks was earlier reduced.

Power Banks rate reduced from 28% to 18% -As per Notification No. 19/2018-Integrated Tax (Rate), Corresponding Notification No. 18/2018- Central Tax (Rate) dated 26th July,2018, Lithium-ion Batteries (HSN-85076000) was taken out and put in Sl. No.376AA of Scheule-18%. Hence, the Electric accumulators, (i.e. Power Bank) including separators were still remain under Sl. No.139 of Schedule of 28%. Now rate of Power Banks will also be 18%.

Other Rate Rationalizations –

Corks – Roughly squared or debagged, Articles of natural cork & Agglomerated cork – Rate reduced from 18% to 12%. In July 2017, the rate of art ware of was reduced. Natural Cork rate is reduced from 12% to 5%. Important is to note that it seems that “Waste cork; crushed, granulated or ground cork” still will remain under 18%

Marble Rubble was reduced from 18% to 5%

Walking Stick reduced from 12% to 5%

Other goods reduced from 28% to 18% –

Pulleys, transmission shafts and cranks, gear boxes etc., falling under HS Code 8483

Monitors and TVs of upto screen size of 32 inches

Re-treaded or used pneumatic tyres of rubber;

Digital cameras and video camera recorders

Video game consoles and other games and sports requisites falling under HS code 9504.

Other goods reduced from 28% to 5% –

Parts and accessories for the carriages for disabled persons

Music Books reduced from 12% to NIL

Vegetables – provisionally preserved, uncooked or cooked by steaming or boiling in water but unsuitable in that state for immediate consumption. – reduced from 5% to NIL

Major Relief for Availing ITC

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.

Any missed ITC hence must be Sanitized and availed immediately. Specified Conditions must be looked into when they come.

No Interest on ITC Wrongly Availed – Interest would be leviable only on the amount payable through the electronic cash ledger

Change in GST Rate on Services –

Changes in Reverse Charge Mechanism –

Security services (supply of security personnel) provided to a registered person,except Government Departments which have taken registration for TDS and entities registered under composition scheme, shall be put under RCM
Services provided by unregistered Business Facilitator (BF) to a bank and agent of Business correspondent (BC) to a BC shall be put under RCM.

Clarifications –

Degrees/ diploma awarded by IIMs under IIM Act, 2017 will be exempt from 31.1.18

Services provided by IFC and ADB are exempt from GST

“printing of pictures” falls under service code “998386: Photographic and videographic processing services” attracting GST @18% and not under “998912: Printing and reproduction services of recorded media, on a fee or contract basis” attracting GST @12%.

leasing of pumps and reservoirs by the OMCs to petrol pump dealers taxable @28%. Leasing of land and buildings along with equipment shall fall under heading 9972 (real estate services) and attract GST rate of 18%.

Incentives paid by RBI to Banks under “Currency Distribution and Exchange Scheme” (CDES) are taxable.

Scope of entry for multi-modal transport with GST rate of 12% inserted w.e.f. date 26.07.2018, covers only transport of goods from a place in India to another place in India, that is, only domestic multi-modal transport.

Nature of business establishment making supply of food, drinks and other articles for human consumption will not determine whether the supply by such establishments is a supply of goods or services. It will rather depend on the constituents of each individual supply and whether same satisfies the conditions / ingredients of a „composite supply‟ or „mixed supply‟.

GST is exempt on supply of food and drinks by an educational institution when provided by the institution itself to its students, faculty and staff and is leviable to GST of 5% when provided by any other person based on a contractual arrangement with such institutions.

Banking company is liable to pay GST on the entire value of service charge or fee charged to customers whether or not received via business facilitator or the business correspondent.

clarification to Food Corporation of India (FCI) that the service provided by godown owner in case of lease with services, where the godown owner, besides leasing the warehouse, undertakes to carry out activities of storage and preservation of stored food grains, is the service of storage and warehousing of agricultural produce and the same is exempt.

Other Changes in Rates of Services –

GST rate on third party insurance premium of goods carrying vehicles shall be reduced from 18% to 12% .

Services provided by GTA to Government departments/local authorities which have taken registration only for the purpose of GST-TDS shall be excluded from payment of tax under RCM and the same shall be exempted.

Services supplied by banks to Basic Saving Bank Deposit (BSBD) account holders under Pradhan Mantri Jan Dhan Yojana (PMJDY) shall be exempted.

Services supplied by rehabilitation professionals recognised under Rehabilitation Council of India Act, 1992 at medical establishments, educational institutions, rehabilitation centers established by Central Government / State Government or Union Territories or entity registered under section 12AA of the Income-tax Act shall be exempted.

Guaranteeing loans taken from banks by Government to their undertakings or PSUs shall be exempt

GST rate on cinema tickets above Rs. 100 shall be reduced from 28% to 18% and on cinema tickets upto Rs. 100 from 18% to 12%.

Services supplied by banks to Basic Saving Bank Deposit (BSBD) account holders under Pradhan Mantri Jan Dhan Yojana (PMJDY) shall be exempted.

Air travel of pilgrims by non-scheduled/charter operations, for religious pilgrimage facilitated by the Government of India under bilateral arrangements shall attract the same rate of GST as applicable to similar flights in Economy class (i.e. 5% with ITC of input services).

Other Decisions by GST Council –

Single cash ledger for each tax head – As of now there are various ledgers for each Tax heads Eg. For IGST the ledgers are – Tax, Interest, Penalty, Fees, Others. This creates a confusion as to which head to pay into and also sometimes results in mistakes and fund blockage. It seems that the intention is to have only 1 Ledger for each such tax head, Eg. IGST, CGST, SGST, UTGST & Cess

Relief for Claiming Refunds –

Single authority for disbursement of the refund – A major relief incase of refunds. Now CGST/IGST is paid by CGST Authority & SGST by SGST Authority. This creates unnecessary delay. This will now be done away with

Faceless refunds – All the supporting documents/invoices in relation to a claim for refund in FORM GST RFD-01Ashall be uploaded electronically on the common portal at the time of filing of the refund application itself, thereby obviating the need for a taxpayer to physically visit a tax office for submission of a refund application. GSTN will enable this functionality on the common portal shortly.

The following types of refunds shall also be made available through FORM GST RFD-01A:

i) Refund on account of Assessment/Provisional Assessment/Appeal/Any Other Order;

ii) Tax paid on an intra-State supply which is subsequently held to be inter-State supply and vice-versa;

iii) Excess payment of Tax; and

iv) Any other refund.

Inverted Duty Refunds Stuck Up – Clarifications shall be issued on certain refund related matters like refund of ITC accumulated on account of inverted duty structure, disbursal of refunds within the stipulated time, time allowed for availment of ITC on invoices, refund of accumulated ITC of compensation cess etc.

New Returns –

New returns filing system shall be introduced on a trial basis from 01.04.2019 and on mandatory basis from 01.07.2019 – It seems that before 2019 elections while the Government wishes to clearly depict its intention of simplification, yet it does not wish to implement any new compliance.

Extension of Due Dates –

GST Annual Return & GST Audit Date extended till 30th June 2019 – Again a populist measure.

The due date for submitting FORM GST ITC-04 (FOR JOB WORK) for the period July 2017 to December 2018 shall be extended till 31.03.2019.

The due date for furnishing FORM GSTR-8 by e-commerce operators for the months of October, November and December, 2018 shall be extended till 31.01.2019.

Changes in Annual Return – Annual Return it seems will not only be a mere compilation of all returns but will include actual figures of Outward & Inward supplies

HSN code may be declared only for those inward supplies whose value independently accounts for 10% or more of the total value of inward supplies – While this gives some relief, yet it still remains a cumbersome job. A complete exemption from disclosure of HSN Code for inward supplies was expected

ITC cannot be availed through FORM GSTR-9 &FORM GSTR-9C – This fact is reiterated.

Additional payments, if any, required to be paid can be done through FORM GST DRC-03 only in cash

All invoices pertaining to previous FY (irrespective of month in which such invoice is reported in FORM GSTR-1) would be auto-populated in Table 8A of FORM GSTR-9 – The efficacy of such Auto Population needs to be seen.

All returns in FORM GSTR-1&FORM GSTR-3B have to be filed before filing of FORM GSTR-9&FORM GSTR-9C
Value of “non-GST supply” shall also include the value of “no supply” and may be reported in Table 5D, 5E and 5F of FORM GSTR-9;

Verification by taxpayer who is uploading reconciliation statement would be included in FORM GSTR-9C.

Migration – One more window for completion of migration process is being allowed. The due date for the taxpayers who did not file the complete FORM GST REG-26 but received only a Provisional ID (PID) till 31.12.2017 for furnishing the requisite details to the jurisdictional nodal officer shall be extended till 31.01.2019. Also, the due date for furnishing FORM GSTR-3B and FORM GSTR-1 for the period July, 2017 to February, 2019/quarters July, 2017 to December, 2018 by such taxpayers shall be extended till 31.03.2019.

Waiver of Late Fees – Late fee shall be completely waived for all taxpayers in case FORM GSTR-1, FORM GSTR-3B &FORM GSTR-4 for the months / quarters July, 2017 to September, 2018, are furnished after 22.12.2018 but on or before 31.03.2019.

No E Waybills for Non-Filers –Taxpayers who have not filed the returns for two consecutive tax periods shall be restricted from generating e-way bills. This provision shall be made effective once GSTN/NIC make available the required functionality.

Creation of a Centralised Appellate Authority – For Advance Ruling (AAAR) to deal withcases of conflicting decisions by two or more State Appellate Advance Ruling Authorities on the same issue. It needs to be seen whether in future, the Scope of such Authority will be expanded.

Also Read- Other Decision in 31ST GST Council Meeting

GST on Goods- Changes proposed in 31st meeting of GST Council

Formation of GoM as Recommended by GST Council in 31st Meeting

In Principle Approval to Centralised AAAR & Interest on net tax liability in 31st GST Council Meeting

GST Council refers 4 important issues to various Committees / GoM

15 Recommendations made during 31st Meeting of GST Council

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  1. Dhinakaran says:

    I haven’t filled 3b from march 2017, last week filled 3b for march 2017, April,may, June with late fees. I didn’t notice of cancellation of gstin on October 2018. but the system accept late fees and return .is there any announcements of gst council 31 meeting on cancellation late fees after April 2018. is there anyway to regenerate my gstin number.

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