31st GST Council Meeting updates

31st GST Council meeting updates
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31st GST Council Meeting updates

After the announcement was made by Prime Minister Modi on Tuesday that all the items which are used by the common man leaving apart the luxury goods shall come under the 18% or lower GST tax slabs. A Twitter war erupted between the BJP and Congress.

Meeting 31st GST Council Meeting
Date Saturday, 22 December 2018
Chairperson Finance Minister Arun Jaitley
Venue Vigyan Bhawan, New Delhi
Attendees Finance Ministers of all the states

Major outcomes from the 31st GST council meeting held are

  Decisions were taken based on discussion and recommendations made by Fitment Panel Committee on rate rationalization.

  A group of ministers will be created and it will take expert opinion from NIPFP(National Institute of Public Finance and Policy) as some states are not showing any improvement in revenues.

  Interest should be charged only on the amount payable i.e Net tax liability after reducing the admissible input
tax credit. Amendment for the same shall be done in section 50 of the CGST Act 2017. – (Note: It will be effective only after an amendment for the same are carried out.)

⊗ It is proposed that a Centralised Appellate Authority for Advance Ruling be created to resolve the issues where conflicting views/decisions for the advance ruling are given by Advance Ruling Authorities of different states is given. (Note: It will be effective only after an amendment for the same are carried out.)

  The next GST Council Meeting is also scheduled which will be held in January 2019.

  • A composition scheme is also being planned to be floated for small service providers with a 5% GST rate. The threshold for the same will be decided in the next meeting after consultation with- Law Committee and Fitment Committee.
  • The decision for the tax rate on lotteries will be taken in the upcoming GST council meeting after the consultation with the Committee of States.
  •  Issues relating to the taxation of residential properties will also be considered in the next meeting after consulting with Law Committee and Fitment Committee.
  • It is also proposed that the threshold limit (which is 20 lakhs) of exemption under the GST regime shall be reconsidered and the decision for the same shall be taken in the next meeting after consulting the GoM on MSMEs.

GST RETURNS

The Due Date for the Annual Return FORM GSTR-9, FORM GSTR-9A, and reconciliation statement (GST Audit) FORM GSTR-9C  for the Financial Year 2017 – 18  is extended to  30th June 2019.

New and simplified GST return forms will be introduced on a trial basis from 1st April 2019. The plan to make it mandatory is from 1st July 2019.

For a regular taxpayer, all the monthly returns in FORM GSTR-1 and FORM GSTR-3B have to be filed before the filing of Annual return FORM GSTR-9 and  GST audit FORM GSTR-9C.

For a composition taxpayer, all the returns in FORM GSTR-4 have to be filed before the filing of the Annual return FORM GSTR-9A.

The due date for e-commerce operators furnishing FORM GSTR-8  will be extended up to 31st January 2019 for the months of October, November & December 2018.

There is a lot of confusion about the HSN codes which need to be given for inward supplies in the Annual Return. So the government has come up with the clarification that the HSN code is required only for those inward supplies whose value independently accounts for 10% or more of the total value of inward supplies.

INPUT TAX CREDIT

One of the major relief granted is that input tax credit for invoices belonging to the last financial year will be allowed upto March 31, 2019. The due date for submitting FORM GST ITC-04 for the period July 2017 to December 2018 shall be extended till 31.03.2019. Taxpayers must note that the input tax credit cannot be availed through FORM GSTR-9 & FORM GSTR-9C.

Soon the clarifications on various issues are expected on matters relating to

  • Refund of ITC accumulated on account of inverted duty structure,
  • Disbursal of refunds within the stipulated time,
  • Time allowed for availing of ITC on invoices,
  • Refund of accumulated ITC of compensation cess etc.

LATE FEES

The Government gives one more chance to the taxpayers who have failed to furnish the GST returns (FORM GSTR-1, FORM GSTR-3B & FORM GSTR-4) for the months/quarters July 2017 to September 2018 with the offer of a complete waiver of late fees if they are filed after 22nd December 2018 and before 31st March 2019.

REFUND

For the ease of taxpayers and obviating the need for a taxpayer to physically visit the tax office for submission of a refund application. Functionality for filing the following type of refunds forms shall also be made available through FORM GST RFD-01A:

  • In case of refund on account of assessment/provisional assessment/appeal/any other order.
  • If the tax is paid on an intra-State supply which is subsequently held to be inter-State supply and vice-versa.
  • In case of excess tax is paid.
  • In case of any other refund

The alternate  procedure/solution for filing the refund application ( other than those relating to refund of excess balance in the cash ledger) before the functionality as mentioned above is rolled out is

  • For the refund applications which have not been submitted in the jurisdictional tax office within 60 days of the generation of ARN.
  • The claimants shall be sent the information about where refund applications shall be submitted on their registered email ids.
  • And if applications for refund are not submitted within 15 days from the receipt of the email then such refund applications shall be summarily rejected, and the debited amount if any shall be re-credited to the electronic credit ledger of the claimant.

E-way bills

Generation of an e-way bill may be restricted for the taxpayers who fail to furnish the GST returns for two consecutive tax periods. This proposal will be made effective once the GSTN/NIV is upgraded with the required functionality.

GST RATES

GST rate for 7 items which belonged to the highest slab of 28% has been brought down to 18%.

There are only 34 items left in the 28% tax rate slab including luxury and sin items.

There is no reduction in the rate of cement and it will continue to be taxed at 28%. It was not taken up in today’s meeting as it has huge revenue implications for the economy. Cement is the only item that is of common use which remains in the 28% slab.

GST rate has been slashed for 33 items which are common man’s consumption goods. The rate has been reduced from 18% to 12% & 5%.



Following references are used to compile the above article

Press release – Recommendations made during 31st Meeting of the GST Council

Press release – Certain important issues referred by GST Council to various Committees / GoM

Press release – For In-Principle approval given for Law Amendments during 31stMeeting of the GST Council

Press release – Recommendations made  for slashing the GST rates during 31st Meeting of the GST Council


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About CA Ankita Khetan 161 Articles
Ankita is a Chartered Accountant in practice and holds a Diploma in IFRS (from ACCA, UK). She is also a Commerce PG and Certified Independent Director (from IICA). She holds a certification in Forex and Treasury Management. Her area of expertise is GST and Income tax. She is passionate about reading, writing, and sharing knowledge on areas related to finance and taxation.

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