By TIOL News Service

NEW DELHI, OCT 06, 2017: ALONG the expected lines, the GST Council at its 22nd meeting here at Vigyan Bhawan in New Delhi today, decided to grant mega relief to small taxpayers and also large assessees. First, the Council has decided to suspend the provisions of Section 9(4) of the CGST Act which brings into play the Reverse Charge Mechanism in case of supplies received from unregistered suppliers. The Council also decided to defer the implementation of TDS, TCS & e-Way Bill. Responding to represetnations, it also decided to reduce tax rates on many items and services including Govt contracts involving more of labour. It also granted relief to the vehicle leasing sector by reducing tax rate.

A mega relief has been granted to the assessees falling under the sweep of the Composition Scheme. First, the threshold of this scheme has been increased from Rs 75 lakhs to Rs one crore. This will bring in more small traders and SMEs under its ambit. To grant further relief, the Council today decided to set up a Five-Member Ministerial Committee to look into the possibility to allow Input Tax Credit (ITC) under this Scheme. Another mandate of this Committee is going to be to examine the possibility of extending inter-state supply facility under this scheme. This panel will also examine whether total turnover should also include receipt from exempted goods. The Panel will also study the taxation system applicable to restaurants and hotels including the ITC benefits which are not being passed on to consumers. Panel will submit its report within two weeks.

While briefing the media, the Union Finance Minister, Mr Arun Jaitely, said that about 16 lakh taxpayers have less than Rs one crore turnover and they come under the Composition Scheme. The two months data with the GSTN has revealed that the Exchequer has garnered above 95% revenue from large taxpayers.

For small manufacturers upto the turnover of Rs 1.5 Crore, the Council has decided to make it quarterly return-filing to ease their burden from monthly return-filing. In this regard, Bihar Dy Chief Minister Sushil Modi today tweeted that above 65% of taxpayers in Bihar are below Rs 1.5 crore turnover and they would stand benefited in a big way. These taxpayers contribute only 5% of the total tax collections in Bihar, he adds.

For the exporting community, the Council has decided to disburse refund of taxes paid from October 10 for the month of July and from October 18 for the month of August. The refund would be done through cheques and also through cross-empowernment of State and Central officials. As a long-term solution, the Council has decided to create an e-wallet account facility for each exporter and refund is to be credited to such accounts in advance and once refund is sanctioned, the same is to be adjusted against the same. This facility is likely to be made operational from March 1, 2018.

For the merchant exporters, the Council has decided to reduce the tax rate to 0.1% for making exporters.

The Council has also decided to defer implementation of E-Way Bill system to April 1, 2018. The Union Finance Minister also mentioned that the State of Karnataka has implemented this system and has collected good experience. Other States are going to replicate the same and that is why some time is being given to all to implement it from April 1, 2018.

Similarly, the Council has decided to defer the implementation of TDS and TCS to April 1, 2018. The requirement of tax on advance has also been dispensed with for the taxpayers upto Rs 1.5 Crore. The Council has also decided to reduce the tax rates on 27 goods and certain services such as khakra, unbranded namkeen, dried mango, unbranded Ayurvedic medicines, rubber & paper waste, man-made yarn, stones other than marble & granite, diesel parts, pumps parts, e-waste plus services like jobwork in imitation jewellery, painting & others.