The 22nd meeting of GST Council concluded a couple of hours back and as rumoured, there were a number of significant changes in the GST rules, which were initially implemented from July 1st, 2017. The GST Council also announced a number of changes for the SMEs, who were worst affected by the implementation of GST.
Below is a detailed list of all the rules which will change starting today with regards to GST.
- GST Composition Scheme Limit has been enhanced to ₹1 Crore, from the existing limit of ₹75 lakhs and it will include 1% tax for traders, 2% tax for manufacturers and 5% tax for restaurants.
- The government has also made it flexible for the SMEs to file their returns. The SMEs and small merchants can now file quarterly GST returns. However, the condition for quarterly GST return filing is that the turn over of the business should be less than ₹1.5 Cr and the business should be a non-composition assessee.
- Refunds of GST to the exporters will be fast-tracked. The refund for the month of July 2017 will be paid back to the merchants starting October 10th 2017 and the refund for August 2017 will be paid by cheque starting October 18th, 2017.
- The government is also planning to initiate the refund for exporters immediately after filing the returns.
- E-Way bill, which was needed to transport any good valuing over ₹50,000 will not be needed till April 2018.
- RCM has been postponed until the end of the ongoing financial year, i.e. March 31st, 2018.
- Earlier, the government had made it mandatory for the individuals to provide details of their PAN card for any jewellery transactions above ₹50,000. The same has now been extended to ₹2 lakhs.
- GST Council has altogether revoked the GST notification on Gems and jewellery. It will bring a new notification after considering all the aspects related to proper taxation.
- Any entity dealing with gems and jewellery will not be covered under the prevention of money laundering act (PMLA), provided that the turnover does not exceed ₹2 crore.
- The GST council has also announced constituting a 5 member committee which will provide its recommendations after reviewing rate of GST for restaurants and interstate sales transactions for composition assessee and exclusion of exempted goods from total turnover and ITC to manufactures opting composition scheme. The committee will submit its report ASAP. Another committee, headed by revenue secretary Hasmukh Adhia, will submit its preliminary report on next Friday about the challenges faced by the exporters and the possible steps to be taken.
- Exporters will be given eWallets from April 2018, using which, they can directly maintain their payment of GST and claim their refunds. The same will be credited back to them immediately after filing the returns.
- Making it even more flexible for the exporters, the GST council has also announced that that the exporters with an advanced licence, 100% EOU and EPCG will be able to export their goods at 0.1% GST till the end of the ongoing financial year.
- For the small service providers, the GST council has recommended exemption from interstate service from RCM, provided the turnover of that particular merchant is below 20 lakhs.
- Collection and deposition of TDS and TCS have been postponed until April 2018.
- 32 items will see the rate changed after the notification is implemented. A list of the items, which will have new GST rates can be found below.
List of items which will have new GST rates
- Man-made yarn to be now taxed at 12%, it was earlier at 18%.
- Jari job work will now attract 5% GST, it was earlier 12%.
- Printing job work will now be taxed at 5%.
- Government contracts will be taxed at 5%
- Unbranded ayurvedic medicines will now attract 5% GST.
- Diesel engine parts will not attract 18% GST, compared to 28% before.
- Tax on food items including dry items has been brought down to 5% from earlier 12%.
The changes listed above have been recommended by the GST Council. However, these will not be implemented till an official notification is passed by the parliament. The GST council is hopeful of bringing the notification ASAP. The next meeting of GST council will take place on 9th and 10th November 2017 at Guwahati.
Article Last updated at 7th October 2017 06:44AM