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13th January 2019

Key takeways from 32nd GST Council Meeting

  Recently, the GST Council has recommended certain changes in its 32nd GST Council meeting held on January 10, 2019. The council proposed various reliefs for MSME (including small traders) such as widening the scope of composition scheme, simplification of compliances, free accounting-cum-billing software for small taxpayers, so on. All these proposals would be effective from the April 1, 2019. Summary of such takeaways are as follows:

  1. Changes relating to Composition scheme
  • Increase in turnover limit for existing composition taxpayers - Annual turnover limit in the preceding financial year for availment of the compositions scheme for goods has been increased from Rs. 1 Crore to Rs. 1.5 Crores. However, Special category States would independently decide within a period of one week about the threshold limit in their respective states.
  • Compliance Simplication - Currently, composition taxpayers are required to file FORM GSTR-4 on quarterly basis. Now, the GST Council has simplified the compliance procedure for such taxpayers. So, now such taxpayers would need to file one Annual Return but payment of taxes would remain on Quarterly basis (along with a simple declaration).
  1. Composition scheme for Service Providers The GST Council has extended the scope for applicability of composition scheme to the service providers who have annual turnover of Rs. 50 Lakhs in the preceding financial year. Under this, the service providers shall be liable to pay GST at the rate of 6% (3% CGST + 3% SGST). The said scheme shall be applicable to both service providers as well as suppliers of goods and services.
  2. The Government shall provide a free accounting-cum-billing software to small taxpayers.
  3. GST Council has asked the group of ministers to evaluate the proposal of extending the composition scheme to real estate sector so as to give a boost to residential housing segment.
  4. The Council has also asked the group of ministers to examine the GST rate structure on Lotteries.
  5. A new cess at the rate of 1% shall be levied on intra-state supply of goods or services within the state of Kerela for a period of not exceeding 2 years for revenue mobilization for natural calamities.
  6. Suppliers of goods (not services) get relaxation from GST Registration. There would be two Threshold Limits for exemption from Registration and Payment of GST for the suppliers of Goods i.e. Rs 40 lakhs and Rs 20 lakhs. States would have to decide about one of the threshold limits within a period of one week. No such relaxation has been given to supplier of services.
  7. The Council has clarified that the changes made by GST (Amendment) Act, 2018 dated 30th August, 2018 would become applicable from February 1, 2019.
  8. Last date for passing the examination for GST practitioners has been further extended till December 31, 2019