Sops rain at 22nd GST Council meeting

Sops rain at 22nd GST Council meeting

Sops rain at 22nd GST Council meeting

The Goods and Services Tax (GST) Council on Friday approved a number of steps to alleviate the new regime-related pains of small businesses and exporters and suspended the implementation of the cumbersome e-way bill and reverse charge mechanisms till the end of the current financial year.

The Kerala minister said the Council was also looking at a few measures to address the liquidity issues being faced by exporters.

After the day-long meeting, Jaitley said small businesses would be allowed to file tax returns once a quarter instead of every month. Also, though returns for the first two months, July and August have already been filed, it was announced that refunds would be made this month through cheques that would be issued on October 10 and October 18. "Overall, a vision-less government drunk with arrogance is wasting a golden opportunity of putting India on a growth trajectory", Congress communication department head Randeep Surjewala said.

Tax rate on diesel engine parts, pump parts, stones used for the objective of flooring (non-marble and granite), and stationery items has been fixed at 18%, down from 28%. Sources said the council has taken an in-principle decision to tax restaurant services at 12%, ending the distinction between air-conditioned (currently taxed at 18%) and non-air-conditioned restaurants (12% tax at present).

Similarly, the tax rate on rotis and khakra was cut along with savouries and ayurvedic and homoeopathic medicines. And, for the rest of the fiscal, exporters can enjoy an exemption with the payment of only 0.1 percent as GST.

A total of 72 lakh taxpayers have migrated from the old regime and 26 lakh new taxpayers have registered under the GST. This was creating an additional tax burden on the large entities.

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Traders will now have to pay fixed tax rate between 1% - 5% under the composition scheme. Along with that, the threshold for composition scheme has been increased from ₹75 lakhs to ₹1 crore and it is going to impact a lot of traders. "The group will see if tax system needs to be revisited, tax rate needs to be reduced without input tax credit..."

The Council also cut rates on 27 products, including man-made yarn, which was a key demand of the textiles sector, media reported.

The scheme can not be opted by supplier of services other than restaurant related services; manufacturer of ice cream, pan masala, or tobacco; casual taxable person or a non- resident taxable person; and businesses which supply goods through an e-commerce operator, according to PTI.

Also, the taxpayer can only make intra-state supply (sell in the same state) and cannot undertake inter-state supply of goods.

A thin, crisp cracker made with wheat flour, salt and oil, Khakhra is a popular staple in Gujarati and Rajasthani cuisine.

Small service providers with revenue less than ₹ 20 lakh have been added to the GST exempt list i.e they are exempted from registering with the GST network even if they are making inter-state taxable supplies of services.

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