Goods and Services Tax Council’s 31st meeting headed by Finance Minister Arun Jaitley took place today at New Delhi and certain major relief measures were undertaken. The meeting comes after Prime Minister Narendra Modi, earlier this week, indicated at further simplifying GST rates, saying that his government wants to ensure that 99 per cent items attract sub-18 per cent GST slab.The Council gave in principle approval to some amendments in the GST Acts and a lot of changes are on the cards. The same would be given effect to through Gazette Notifications/ Circulars which shall have force of law.

Here are some of the major relief points offered:

(A)Rate Cuts:

• Announcing the decision after the GST Council meeting, FM said that the following items have been brought down from 28% to 18% slab:

ITEMS	Existing Rate (%)	New Rate (%)
Pulleys, transmission shafts and cranks, gear boxes etc., falling under HSN Code 8483	28	18
Monitors and TVs of upto screen size of 32 inches	28	18
Re-treaded or used pneumatic tyres of rubber	28	18
Power banks of lithium ion batteries	28	18
Digital cameras and video camera recorders	28	18
Video game consoles and other games and sports requisites falling under HSN code 9504	28	18
Cinema tickets priced above Rs. 100	28	18

 

There are just 28 items like air conditioners, cement, dishwashers, automobile parts, pan masala, aerated drinks and tobacco products etc. that remain in the 28 per cent tax bracket. It was decided not to cut GST cut on cement and auto parts in view of the revenue implications.

• A steep cut was announced on Parts and Accessories for carriages for specially abled persons from the highest slab of 28% to 5%. Finance Minister said the government is committed towards rate rationalisation.

 

• Listed below are the items on which the rate reduction is from 18% to 12%

 

ITEMS	Existing Rate (%)	New Rate (%)
Cork roughly squared or debagged	18	12
Articles of natural cork	18	12
Agglomerated cork	18	12
Cinema tickets up to Rs. 100	18	12
Third party insurance premium of goods carrying vehicles	18	12

 

 

Rates of GST were slashed on as many as 33 items reduced from 18 per cent to 12 and 5 per cent respectively as they are common man’s consumption goods.

• GST rate on special flights for pilgrims lowered for economy at 5 percent and business class at 12 percent.

 

• GST rate on marble rubble slashed from 18% to 5%.

 

• The items which enjoyed a rate cut from 12% to 5% are as follows:

 

ITEMS	Existing Rate (%)	New Rate (%)
Natural cork	12	5
Walking Stick	12	5
Fly ash Blocks	12	5

 

• Music Books will now attract no GST which were earlier in the slab of 12%.
• Other items which were falling under the category of 5% will now enjoy exemption from GST and are as mentioned below:

ITEMS	Existing Rate (%)	New Rate (%)
Vegetables (uncooked or cooked by steaming or boiling in water) frozen, branded and put in a unit container	5	NIL
Vegetable provisionally preserved but unsuitable in that state for immediate consumption	5	NIL

 

(B)Other Pronouncements

• The new rates will be effective from effective January 1, 2019.

 

• The Council has decided that 5 per cent would be levied on renewable energy devices and parts for their manufacture.

 

• The GST Council approved the proposal to form a 7-member Group of Minister to study revenue trends and analyse the reasons for structural patterns affecting the revenue collection in some of the states. “The study would include the underlying reasons for deviation from the revenue collection targets vis a vis original assumptions discussed during the design of GST system, its implementation and related structural issues.

 

• The finance minister said IIM Courses and services by the banks to Pradhan Mantri Jan Dhan Yojana account holders will be exempted for paying any Goods and Services Tax.

 

• New return filing system will be started on a trial basis from April 1, to be implemented mandatorily by July 1, says Revenue Secretary.

 

• Additional GST fees waived for returns filed upto 31^st March 2019.

 

 

• There would be a single cash ledger for each tax head. The modalities for implementation would be finalised in consultation with GSTN and the Accounting authorities.

 

• The due date for furnishing the annual returns in FORM GSTR-9, FORM GSTR-9A and reconciliation statement in FORM GSTR-9C for the Financial Year 2017 – 2018 shall be further extended till 30.06.2019

 

• A Group of Ministers will be created and it will take expert opinion from NIPFP as some states are not showing improvement in revenues.

 

• Mega relief to taxpayers – ITC for last FY invoices allowed upto March 31, 2019

 

• GST Council approves Single Interface for disbursal of refund + rationalisation of cash ledgers and extension of due dates for furnishing FORM GSTR-8 by e-commerce operators for the months of October, November and December, 2018 shall be extended till 31.01.2019.

 

• HSN code may be declared only for those inward supplies whose value independently accounts for 10% or more of the total value of inward supplies

 

• GST Council approves proposal to deny generation of e-Way Bills if returns not filed for two consecutive tax periods.

 

• No ITC to be availed through Form GSTR-9 & GSTR-9C. Verification by taxpayer who is uploading reconciliation statement would be included in FORM GSTR-9C.

 

• Creation of a Centralised Appellate Authority for Advance Ruling (AAAR) to deal with cases of conflicting decisions by two or more State Appellate Advance Ruling Authorities on the same issue.

 

• Amendment of section 50 of the CGST Act to provide that interest should be charged only on the net tax liability of the taxpayer, after taking into account the admissible input tax credit, i.e. interest would be leviable only on the amount payable through the electronic cash ledger.

(C)Matters Yet To Be Taken Up:

• GST on real estate to be decided in the next meeting scheduled in January 2019

 

• A composition scheme will be framed for small service suppliers with 5% tax rate. Threshold will be decided in the next meeting after consultation with Law Fitment Committee.

 

• There would be a single cash ledger for each tax head. The modalities for implementation would be finalised in consultation with GSTN and the Accounting authorities.

 

• A scheme of single authority for disbursement of the refund amount sanctioned by either the Centre or the State tax authorities would be implemented on pilot basis. The modalities for the same shall be finalized shortly.

 

• In the forthcoming meetings, the council may also discuss ways to increase collection and stop tax evasion. The government has always said that more items would be brought down to 18% or less rate but only if there was enough revenue buoyancy.

 

• A decision on disaster cess will also be taken in the next meet. A GoM is in the process of finalising the report.

 

• The rate of tax and threshold limit on lotteries to be taken up in the next meeting of the Council.

FM Jaitley said the decisions taken today at the GST Council meeting in Delhi will have an overall impact on revenue of Rs 5,500 crore.

 

 

 

_______________________________________________________________________________________________________________________________________

We’re listening:

 

Reach us at https://taxmantra.com/business-maintenance/ or Call/WA us at +91-9230033070 for any support/query/feedback.

 

__________________________________________________________________________________________________________________________________