Two days meet of Goods and Service Tax Council meet has introduced more liberation after three months of roll out of new tax regime in order to assist the Taxpayers with more ease of administration. The concentrated deliberation of GST Council leads towards removing the deficits in GST Law Regulations by announcing reduced tax rates and waiving the penalty on GST Return filings.
GST Updates are categorised below in simplified manner for our readers:
Reduction of Rates of Tax:
- Reduction of Tax on mass consumption Goods:
Goods which are under the mass consumption by the common man including daily usage household goods are now cheaper. Earlier falling under highest tax slab of 28% is now shifted to become cheaper through introducing under slab of 18%.
Where the GST rate fitment committee had recommended keeping 62 items under highest tax slab of 28%, the council has decided to keep only 50 items under the said slab leaving demerit, sin and luxury goods under highest tax slab.
- Rates on Restaurants:
- All restaurants across country will now attract flat rate of 5% GST, which results into cheaper outdoor food. However, the benefit of ITC (Input tax Credit) will not be available for restaurants.
- The said rate will be implemented irrespective of facility of air-conditioning.
- Restaurants in hotel premises: this will attract GST at the rate of 5% without ITC where the room tariff of said hotel rooms are less than Rs 7500/-.
Filing of Returns and Penalties levied:
- GST Return Filings for Small Businesses:
- Small Taxpayers to file return once a quarter.
- Small Businesses with turn-over less than Rs 1.5 Crore are exempted from filing GSTR 2 and GSTR 3.
- Small Business will have to file quarterly return of GSTR – 1 till March, 2018 i.e. till the end of financial year 2017-18.
- Filing of GST Return – 3B is however to be continued on monthly basis.
- Composition Scheme:
Suggestion has been made to raise threshold limit of composition scheme to an annual turnover of Rs 1.5 Crore under the scheme, and flat tax of 1 per cent tax for all.
- Penalty on late filings:
The higher penalty earlier has been rationalised by introducing following:
- For NIL Returns: Penalty has been reduced to Rs 20 for each day of delay in filing the returns.
- Other category: The penalty is reduced to Rs 50 per day for delay in filing the return after prescribed due date.
GST Council meets are heading towards rationalisation of tax rates for the best of the common man and taxpayers by counducting meeting of FInance MInisters of States since rolling of New Tax regime.