By TIOL News Service

NEW DELHI, OCT 30, 2017: THE Ministerial Panel set up by the GST Council to recommend measures to make the Composition Scheme more attractive for the taxpayers is believed to be in favour of further hiking the threshold to Rs 1.5 Crore - a sum historically known for SSI exemption in the erstwhile regime. The Panel also might favour a further reduction in the tax rate which can be uniform for all the three categories of taxpayers - traders, manufacturers and restaurants. One source says that the majority has favoured 1% rate for all composition taxpayers.

Within the composition category, the panel may also favour 0.5% tax rate for those dealers who sell both exempted and dutiable goods. The eye of the panel is on kirana stores in the neighbourhood. There is a strong likelihood that the composition taxpayers may be allowed even inter-state supplies.

The Panel is also in favour of uniform tax rate of 12% for non-AC and AC restaurants. For restaurants in hotels with daily tariff of above Rs 7500/- may be kept at 18%. For below Rs 7500 tariff, the rate may be kept at 12%. Whether ITC is to be disallowed to restaurants is an issue on which consensus is yet to be developed.

Meanwhile, the GSTN is ready to make available the GSTR-4 for the composition taxpayers who would be filing their returns for the first quarter of July to September. A lot will depend on the rising graph of compliance by the composition dealers and a view may be taken at the next GST Council meeting on Nov 10, 2017 at Guwahati.