46th GST Council Meeting
46th GST Council Meeting was held on Friday, 31st December 2021 at New Delhi under the Chairmanship of Finance Minister Nirmala Sitharaman. Last i.e 45th GST Council Meeting was held more than 3 months back on 17th September 2021. After the breakout of the COVID-19 pandemic, GST Council will meet for the second time for the physical meeting.
It is likely that GST Council is meeting on short notice to discuss the recommendations of the Fitment Committees. Notice to convene the 46th GST Council Meeting was communicated in the late evening hours on 29th December 2021.
Next i.e 47th GST Council Meeting is likely to be held at the end of Feb 2022 or early Mar 2022.
Major GST updates that once must know
- Most of the amendments notified by Finance Act 2021 are likely to be implemented w.e.f. 1st January 2022 – Check Notifications
- Due Dates for GST Annual Return & GST Reconciliation for FY 2020-21 were extended to 28th February 2022 – Check Notifications
- Rule 36(4) has been amended to waive off the 5% cushion allowed for eligible ITC. Now ITC is to be claimed strictly based on to ITC reflected in Form GSTR 2B. – Check the combined impact of Section 16(2)(aa) & Rule 36(4)
Key Takeaways from 46th GST Council Meeting
⊗ It was a single agenda emergency meeting.
⊗ There was no discussion on compensation States from the Centre.
⊗ There was no discussion on the new COVID variant Omicron.
⊗ No discussion was done on reversing the hike on the GST rate on footwear. Hiked GST rate will be rolled out from 1st January 2022. The decision was taken in the 45th GST Council Meeting in order to correct the inverted duty structure.
⊗ The hike in the GST rate in the textile industry has been deferred. Hiked GST rate will not be rolled out from 1st January 2022.
Note: For correcting the inversion in the textile industry has been referred back to the Fitment Committee for rate rationalization.
Note: A CGST(Rate) Notification no. 14/2021 was issued on 18th November 2021 where GST rates were hiked from 1st January 2022 is likely to be rolled back.
⊗ Fitment Committee will review and submit the recommendations in Feb 2022.
- Review the exempted goods & services in order to expand the tax base & eliminate the breaking of the ITC chain.
- Review the correction of the inverted duty structure. GOM is expected to recommend suitable rate changes in order to minimize the refund payout by reviewing the items under the inverted duty structure.
- Review the current tax slab structure and recommend if any changes which can lead to a better and simpler tax structure i.e merging of tax slabs, eliminating tax slabs, etc.
Note: The recommendations/decisions of the GST Council shall be effective only when notifications/circulars are issued through the Official Gazette.