The 29th GST (Goods and Service Tax) council took place in New Delhi on 4th August 2018. The meeting was chaired by the finance Minister of India,Shri Piyush Goyal. The following topics were the highlights of the meetings- cash back on digital payments and the issues of MSMEs.
Summary of the meeting:
Cash Back on Digital Transaction:
1) For the promotion of a digital economy the usage of digital transaction is to be encouraged to users. To encourage digital payment, the council has proposed all payments made digitally will be awarded with cash back of 20%.
2) The following systems will accept digital payment and provide cash back-
- Rupay Debit Card
- BHIM UPI (Bharat Interface for Money based on Unified Payment Interface )
- UPI Aadhaar
- USSD ( Untrusted Supplementary Service Data)
3) The cash back limitation will be Rs.100 per transaction with the cash back percentage of 20 which will be awarded back to the consumers account.
4) GST council is taking this step as a trial process to check if the tax payment collection enhances or not.
5) GST council has recommended developing software but didn’t make it mandatory for the states to comply with the new method. Only if the states wish to, they can implement the process.
Issues of MSMEs (The Micro, Small and Medium Enterprise)
A sub –committee/ panel consisting of a group of ministers has been created to review and address the issues of MSMEs and other small taxpayers. With the objectives of addressing to the issues of the MSMEs and small taxpayers, the committee has been divided based on certain subjects. The issues addressing to law will be handled by the law committee and the issues of connected to rates will be undertaken by the fitment committee. The sub-committees have to submit their verdicts in the form of a report addressed to the head of the main committee. The main committee will be headed by Minister of Finance, Shiv Pratap Shukla.
The Prospect of the 29th GST Council meeting:
1) The enhancement of MSMEs and other Small Businesses
At the previous GST council meeting which was 28th, a lot of debate took place about SME (Small and Medium Enterprises) sector and on this 29th GST council meeting these discussions has been further stretched to completion of the proposals made before.
The SME (Small and Medium Enterprises) have been very much enjoying a lot of benefits because of GST council. Many agreements have aided these businesses given by the means of threshold exemptions, composition schemes, the Quarterly fillings of the GST return.
This meeting will mainly bring together the number of issues reportedly faced by the small business and to help growth of recruitment in this sector and entrepreneurship in the Small and Medium Enterprise sector.
The probable agendas for MSMEs:
-The inter-state supplies will be rewarded with an immunity of Rs.20lakh.
– To increase the immunity of the mandatory creation of e-way bills to Rs1 lakh or will be immune for movement within some specific states.
– The tax rates to be reduced to a maximum of 5% for SME units working in the production of agro products.
– The decrease of the blockage of working capital by quicker approval of refunds from GST for this particular sector.
– To promote a new interpretation of MSME from a turnover view to match it with the GST laws.
– To put an end to the problems that rises over time during VAT system and still awaiting conclusions. A clear policy to be taken through one time decision which will be applicable for every states.
2. Improvement to extend Digital Payments facilities among Indians:
Shri Piyush Goyal who chaired the meeting, pointed out that the usage of digital payment facilities such as Rupay Debit card, BHIM app, UPI Aadhaar and USSD (Untrusted Supplementary Service Data) must need to become larger and famous among specific income groups. The middle-class and lower-class are the targeted groups of the Indian population who needs to become familiar with digital transaction. This meeting will assist the progress of more discussion and decide on the suggestions put in front of Shri Sushil Kumar Modi committee, the committee which was formed with the main aim of Digital transactions.
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