10th November, 2017, marks a new beginning for the Indian economy.It was the 23rd GST council meeting. GST news update will be covered briefly in the following sections. The event promises an overall development in the economy of the state as a whole. It should be mentioned that the following changes has potentially began from 15th November, 2017.
Alterations made in Composition scheme
- Composition scheme will possibly increase up to Rs. 1.5 Cr and may extend up to Rs. 2 Cr later.
- 1 percent of GST rate is fixed for traders and manufacturers
- Composition tax of 1% will be imposed on turnover of taxable products; excluding turnover of exempted products.
- Suppliers of products, which do not surpass Rs. 5 lakhs in total, are eligible for composition scheme.
- Composition Returns, GSTR-4 due date has been extended from July to 24th December, 2017 instead of September
- Inter-state sales cannot be done by composition dealers.
- Input tax benefit is forbidden.
GSTR Compliance Benefits
According to the 23rd GST council meeting, all the businesses must file to GSTR-1 and GSTR-3B and the deadline is March 2018. The Committee Officers will finalize the dates of filing for GSTR-2 and GSTR-3 for July 2017 to March 2018 later on. Business turnover, which is below Rs. 1.5 Cr has to file GSTR-1 every three months. Meanwhile, GST news update states that the business turnover, which is above the Rs. 1.5 Cr mark, has to file GSTR-1 every month. All companies are required to file GSTR-3B starting from the 20th of December till March 2018.
Service Providers Benefits
From GST news update, it is observed that the service providers, whose own turnover reaching Rs 20 lakhs has been absolved from the GST registration. It includes the service providers who provide services within states or through some e-commerce sites. Such service providers are required to register under GST. As for restaurant services, the GST rate has been reduced to 5% without the addition of input tax credit which may come off as a challenge for the restaurant businesses.
Other Taxpayer Benefits Measure
- According to the GST news update, regular taxpayers do not have to pay GST in advance on the received supply of goods.
- For late NIL tax filing of GSTR-3B, late fees used to get added. However, it has been diminished from Rs 200 per day to tremendously low Rs 20 per day. The other taxpayers who are late in filing the GSTR-3B has to be pay a late fee of Rs 50 per day.
- The late fees sanctioned for GSTR-3B for the months of July, August and September has been removed. In fact, those who have already paid late fees for these three months have been financed back to Electronic Cash Ledger under the section “Tax” and those payments can be later used to make GST payments.
- The option to manually file for Advance Ruling application has been introduced.
- GST exempts the export of services to countries Nepal and Bhutan.
- A refund of input tax credit, if any, is permitted to the export services to Nepal and Bhutan.
- A onetime revision of TRAN-1 was permitted to be filed within 31st December, 2017.
- The Officers’ Committee had worked out the timelines for the filing of GSTR-2 and GSTR-3 for July 2017 to March 2018. But the impact will not be on the ensuing month of filing GSTR-1.
Rate Changes in GST
- The manufacturers and the traders under composition scheme will have a GST rate of 1%.
- The following goods have a reduced rate to 18% to 20% according to W.E.F, 15th November, 2017 – shampoo, perfume, tiles and watches.
- The following goods have a reduced rate to 12% from 28% – wet grinders and tanks
- The following goods have a reduced rate to 12% from 18% – condensed milk, diabetic food, refined sugar.
- The following goods have a reduced rate to 5% from 12% – desiccated coconut, dosa, idli mix, coir products.
- The following goods have a reduced rate to nil from 5% – duar meal, dried vegetables, khandsari sugar
- The GST rate for restaurants inside hotels with room tariff of less than Rs 7,500 is 5%. It is to be mentioned that the credit of ITC which is paid on inward supplies cannot be availed.
- The GST rate for restaurants inside hotels with room tariff of more than Rs 7,500 is 18%. It is to be mentioned that the credit of ITC which is paid on inward supplies can be taken back.
- The restaurants where outdoor catering services are still charged basically at 18% and can claim the ITC on supplies that are inward.
These are the major changes imposed on the Goods and Service Tax on various products according to the GST news update in the 23rd GST council meeting of 2017. For further details visit our website