GST Council reduced rates of 29 goods, 54 categories of services

GST Council reduced rates of 29 goods, 54 categories of services

Andrew Cummings
January 19, 2018

The Goods and Services Tax (GST) Council on Thursday chose to provide a three-year tax exemption for viability gap funding given under the regional air connectivity scheme, and reduced tax rate on 29 items and 54 categories of services.

At today's meeting, the GST Council, headed by Finance Minister Arun Jaitley, is also expected to ease compliance for filing returns.

But it is important to note that GST on 29 handicrafts items have been reduced to 0 per cent, which will increase competitiveness in global markets and exports will increase which in turn boost economy.

The issue of simplifying the three-form per quarter return filing procedure was taken up by the GST Council. The council however is still mulling over taking petroleum products and Real Estate into its ambit.

Earlier today, Union Finance Minister Arun Jaitley chaired the pre-budget meeting with finance ministers of all the states and Union Territories here. "The Fitment Committee has approved relaxation on 29 handicrafts to 0%", Pant added.

The finance minister is yet to reveal the goods and services as part of these 29 items.

The large amount of IGST credit was considered.

The council also decided that 3B returns filing will continue and suppliers can continue to load their invoices. The Council felt that once the GoM, IT Committee and Nandan Nilekani discuss the matter and formalise it, then it will be circulated among the ministers and approval will be taken during the next GST Council meeting. If the Government notices that any purchasing taxpayer has taken credit more than what is reflected in its name as per the invoices uploaded by its suppliers in their GSTR 1; the Government may undertake an audit and seek an explanation.

The exemptions from GST will, among other things, now apply to supply of services for providing information under RTI Act, legal services provided to government, local authority, governmental authority and government entity, transportation of goods from India to outside by air and sea, services relating to admission or conduct of examinations provided to all educational institutions, entrance fees for entrance examination and for transportation of students up to higher secondary schools. A lot of tax evasion can be plugged through E-way bill and those who do not take e-way bill will be penalised, Sushil Modi said after the meeting.

The Council "provisionally" made a decision to divide Rs 35,000 crore of the Rs 1.35 lakh crore integrated GST (IGST) collected till now among the states and the Centre. Keeping this in mind, GST Council in October had deferred the mechanism till April 1. Nearly 15 states have also agreed to put in place an Eway bill system to track inter-state movement of goods.

The government has also, time and again, extended return filing dates.

However, he informed the public about the next meeting with the GST council, that will be held after ten days of the long period, via the mode of video-conferencing. He said, the traders will have to mandatorily upload the e-way bill after its roll out.

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