The Goods and Services Tax (GST) Council held its 22nd meeting in Delhi on Friday to consider relaxing the return filing cycle for small and medium enterprises. As per the latest reports coming in from the meeting, the council made a couple of reforms via relaxation of GST rates on certain commodities.
Here are the major takeaways from the GST council meeting
# GST rate on 27 items reduced: FM Jaitley
# Members wanted to revisit tax structure of restaurants with more than Rs 1 Cr turnover, will be reviewed: Jaitley
# Man-made yarn was taxed 18%, it has been put in 12% slab, will have effect on textiles: FM Jaitley
# Businesses with turnover above Rs 1.5 cr to continue filing monthly returns: Jaitley
#E-way bill was discussed and K'taka has had good experience with it, after 1 Jan it'll go to other states; will try to implement by 1Apr: Jaitley
# Traders to pay 1%, manufacturers 2% & restaurants 5% under composition scheme: Jaitley
# 90% of the assesses who have turnover less than Rs 1.5 Cr turnover to file quarterly returns: Jaitley
# Refund cheques for July exports will be processed by 10 Oct and refund cheques for Aug exports, will be processed by 18 Oct: Jaitley
# The limit for turnover in compensation scheme raised from Rs.75 lakh to Rs. 1 crore: Jaitley
# There has been blockage in credit of exporters which affects their cash liquidity: Jaitley
# E-wallet for each exporter to be made and notional amount as advance refund will be given and it will be initiated on 1 April 2018: Jaitley
#Pattern of collection (of GST) is not clear after two months because it was a period of transition: Jaitley
#Exporters to get IGST relief for 6 months
# Yarn, clips and pins have been brought down to the 5 percent slab
# Bills in AC restaurants to become cheaper
#Six months wait for e-Wallet facility to come up for exporters
# PAN card may not be needed for jewellery above Rs 50k
# Threshold for composition scheme in GST hiked from Rs 75 lakh to Rs 1 crore
# India Ratings and Research believes that the four-rate tax slabs of 5%, 12%, 18% and 28% in GST would have a bearing on the profitability of most industries. Further, additional cess on some of the products, if absorbed by the respective businesses, would impact their margins.
# GST Council decides to roll out the e-way bill from April, say CNBC TV18 sources
GST is good, but 28 per cent is very high, says Craig Smith, President and MD, Asia Pacific, Marriot International. Under the GST regime, hotels with room rent exceeding Rs 7,500 attract tax rate of 28 per cent, while accommodation in any hotel, including 5-star hotels, with tariff of less than Rs 7,500 per day is to be taxed at 18 per cent.
Restaurants, cab services among 60 items for which rates are likely to be cut.
Initial hiccups pertinent to GST are expected to be resolved soon, facilitating growth in the second half. On the broader horizon, structural reforms introduced by the government and ongoing formalization will boost economic growth, says Hitesh Jain, IIFL Wealth Management
Vice President M Venkaiah Naidu says discussions on the economy and GST should carry on, stressing that such debates are always good for democracy.