GST 28th Council Meeting
The GST Council in its 28th meeting held on 21st July 2018 in New Delhi under the Chairmanship of Shri Piyush Goyal recommended significant changes in the GST laws on reduction in GST rates, simplified compliance and migration window for tax payers.
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Highlights of the decisions taken by the GST Council in its 28th Meeting:
1. Threshold exemption limit for GST registration in Assam, Arunachal Pradesh, Himachal Pradesh, Meghalaya, Sikkim and Uttarakhand should be increased to INR 2 million from existing INR 1 million (i.e. Rs20 lakhs from Rs10 lakhs)
2. Unregistered Dealers: On receipt of supplies from unregistered suppliers, GST under reverse charge should be applicable only on specified goods in case of certain notified class of registered persons on the recommendations of the GST Council.
3. Cancellation of registration: GST registration to remain temporarily suspended while cancellation of registration is under process to provide relief from compliance requirements
4. Multiple registrations: Taxpayers may opt for multiple registrations within a State / Union Territory in respect of multiple places of business located within the same State / Union territory
5. E-commerce: Mandatory registration required for only e-commerce operators who are required to collect tax at source
6. Composition Scheme: Upper limit of turnover for composition scheme to be raised from Rs 1 crore to Rs 1.5 crores.
Composition dealers may supply services (other than restaurant services) up to 10% of turnover in the preceding financial year or INR 500,000/-whichever is higher
7. Non-taxable transactions: The following transactions should be treated as non-taxable supplies under Schedule III:
a. Supply of goods from a non-taxable territory to another non-taxable territory without such goods entering into India;
b. Supply of warehoused goods to any person before clearance for home consumption; and
c. Supply of goods on high-sea sales.
8. Payment to Suppliers: If the recipient fails to pay the supplier within 180 days from the date of issue of invoice, ITC availed by the recipient should be reversed with no interest payable.
9. Consolidated credit / debit notes: Taxpayers may issue consolidated credit / debit notes in respect of multiple invoices issued in a Financial Year
10. Job Work: The Commissioner should be empowered to extend the time limit for return of inputs and capital sent on job work uptoa period of 1 year and 2 years respectively.
In case of job work, ‘place of supply’ of any process done on goods temporarily imported into India and then re-exported should be outside India.
11. Export of Services: Supply of services may qualify as exports even if payment is received in Indian Rupees if permitted by Reserve Bank of India (‘RBI’).
12. Recovery can be made from distinct persons, even if present in different State / Union Territories
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GST Returns:
• The GST Council approved the new return formats.
• All taxpayers (excluding small taxpayers and a few exceptions) will be required to file one monthly return reporting outward supplies and ITC basis invoices uploaded by the supplier
• Small taxpayers having turnover below INR 50 million (i.e. Rs 5 crores) may file quarterly returns similar to main return with monthly payment facility separately for B2C supply or B2B & B2C supply
Please refer Press Release on the decisions of the GST Council on simplified GST Return: http://pib.nic.in/PressReleseDetail.aspx?PRID=1539570
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GST Rate changes:
The GST Council took significant decisions relating to changes in GST rates, rationalization of rates, exemptions and clarification on levy of GST on several goods, specified handicraft items and services.
Please refer Press Releases on the decisions of the GST Council relating to GST rate changes which would be given effect to through Gazette notifications / circulars which shall have force of law.
• GST rate changes on goods: http://pib.nic.in/PressReleseDetail.aspx?PRID=1539574
• GST rationalization on Services: http://pib.nic.in/PressReleseDetail.aspx?PRID=1539571