GST ‘Has Become Even Simpler’ After FM Jaitley’s Key Changes: Modi
The GST council meeting chaired by Arun Jaitley lasted eight hours on Friday.
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The 22nd Goods and Services Tax (GST) council meeting came to an end after eight hours on Friday, 5 October, after which Finance Minister Arun Jaitley addressed the nation.
He announced GST cuts for 27 products, including khakhra and chapati. Jaitley also announced that a group of ministers would review slashing the 18 percent tax for eating in AC restaurants to 12 percent, and submit a report in two weeks.
The Finance Minister said companies with a turnover till Rs 1.5 crore would have to file returns quarterly instead of monthly.
- The 22nd GST Council meet ends after eight hours at Vigyan Bhavan in New Delhi
- The meet was chaired by Finance Minister Arun Jaitley
- Prime Minister Modi said the GST has become even simpler, more people friendly and effective
- Jaitley addresses the nation after the meeting, announces GST cuts on 27 products
- Companies with a turnover of up to Rs 1.5 crore will have to file returns quarterly instead of monthly
- Govt will mull over slashing 18 percent GST for eating in AC restaurants to 12 percent
- Exporters get GST exemption till 31 March, 2018
"GST Becomes Even Simpler"
Prime Minister Narendra Modi congratulated Finance Minister Arun Jaitley and the GST Council for the extensive feedback with various stakeholders, which led to the decisions announced today.
Citizens Get Relief
Jaitley said the council also decided to cut GST rate on 27 commonly used items.
GST on unbranded namkeen, unbranded ayurvedic medicine, sliced dried mango, and khakra has been cut to 5 percent from 12 percent, while the same on man-made yarn used in the textile sector has been reduced to 12 percent from 18 percent.
Food packets given to school children under the Integrated Child Development Scheme (ICDS) will attract 5 percent tax now instead of 12 percent.
Zari making, imitation jewellery, food items, and printing items would attract 5 percent tax instead of 12 percent.
Government contracts involving high amount of labour will have a tax of 5 percent GST levied on them instead of 12 percent in order to contain cost of those programmes, Jaitley said.
Karnataka Has Good Experience with E-Way Bill
Jaitley said that the e-way Bill was discussed and Karnataka is already having a good experience with it. This method will be available in other states by 1 April 2017.
AC Restaurants May Get Relief
AC restaurants may get relief as the group of ministers will discuss if the GST should be slashed from 18 percent to 12 percent and submit a report in two weeks.
Companies With Turnover of Up to Rs 1.5 Crore Get Relief
Companies with a turnover up to Rs 1.5 crore will have to file returns quarterly instead of monthly, Jaitley announced after the GST council meeting.
Traders to pay 1 percent, manufacturers 2 percent and restaurants 5 percent under composition scheme.
Refunds for Exporters to Get Processed
In a relief for exporters, Finance Minister Arun Jaitley said that from 10 October, refunds for the moth of July will be processed, and from 18 October, refunds for August will be processed and exporters will be given their cheques.
By 1 April, 2018, an e-wallet system will be put in place for the convenience of exporters and a notional amount as advance refund will be given to them.
GST exemption for exporters till 31 March, 2018 and a nominal 0.1 percent GST will be charged on exports.
Pattern Unclear Due to Transition
Speaking after the 22nd GST Council meet, Finance Minister Arun Jaitley said that the pattern of collection of the GST has not been clear after two months as it was the period of transition.
GST Notification on Jewelry Revoked
The government revoked the GST notification on gems and jewelry, and a separate notification will be issued separately after due consideration. Any person buying jewelry above Rs 50,000 will not be required to submit PAN or Aadhaar Card details.
Any entity dealing in gems, jewelry or any other high-value goods with a turnover of Rs 2 crores or more in a financial year will not be covered under the PMLA.
After the GST roll out in July, the government had notified in August that the Prevention of Money Laundering Act (PMLA) will be applicable on the jewelry industry. Under that notification, any sale of gold above Rs 50,000 required customers to furnish Know Your Customer (KYC) documents to the jeweler and also file certain returns, which was feared to have an adverse impact on sale of gold jewelry.
Businesses Under 1 Cr to File Return Quarterly
Businesses with a turnover of up to Rs 1.5 crore will now have to file their returns quarterly and not monthly, as CNN News18 reported.
Sushil Kumar Modi also said the same, referring to the businesses in Bihar, 65 percent of which have a turnover of less than Rs 1.5 crore.
Finance Minister to Address Nation
Finance Minister Arun Jaitley will address the nation after the GST council meeting, CNN News18 reported.
Issues Faced by Small Traders Discussed
The Andhra Pradesh Finance Minister Y Ramakrishnudu said that issues faced by small traders were discussed at the GST council meeting.
GST Council Meet Underway
The 22nd GST Council meeting chaired by Finance Minister Arun Jaitley is underway at Vigyan Bhavan in New Delhi.
Officials in the ministry said that the group of Ministers set up under Sushil Modi will be looking into glitches of the newly implemented GSTN. They will alsowill also brief the Council on the portal’s functioning. Another committee under Revenue Secretary Hasmukh Adhia is likely to submit its preliminary report on issues faced by exporters to the Council.
Announcement on Easier Refund, Reverse Charge Likely
Some measures to ease the difficulties being faced by traders owing to GST are likely to be announced after the GST Council's meeting on 6 October.
Prime Minister Narendra Modi met Finance Minister Arun Jaitley and BJP President Amit Shah on Thursday to discuss the state of the Indian economy and steps to revive growth. Jaitley himself refused to disclose anything about the discussions with the Prime Minister and the party president.
It is understood that after the GST council meeting on Friday, there could be announcements like easier refund of input credit for exporters, deferring of reverse charge mechanism for unregistered traders, and a promise of no enquiry into the tax matters of the previous VAT regime of indirect taxes.
“Government is With You,” Says PM Modi
In his speech at the Institute of Company Secretaries in New Delhi on 5 October, the Prime Minister had promised the traders that the government would not dig into the past through any retrospective investigation of traders joining the formal economy.
Addressing concerns arising out of teething troubles in implementing the Goods and Services Tax (GST), he said his government was committed to removing the bottlenecks.
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