Council Raises GST Bar in India – Relief to Small Business
The government has proposed several amendments to the GST Law to make it more business
friendly and allow tax-credits that will lower the burden. Several genuine transactions which
were not eligible for Input Tax Credit (ITC) will now be eligible.
The goods and Service Tax (GST) Council approved a streak of measures pointing to promote
small business such as multiply the exemption threshold to 40lakh. Resulting in merger turnover
limit for service providers considering to avail the low – compliance composition program.
At the council meeting, the composition program limit was raised to 1.5 crores from 1 crores,
addressed by Arun Jaitley – who leads the council. “ This will come into existence from 1st of
April 2019.
With the discharge for registration and payment of GST registration has been lifted to 40lakh from 20Lakh for the supplier of goods, states would be flexible enough to decide on one of those in a week.
The inception will be doubled to 20lakh from 10lakh in Northeastern and hilly states. Yet for
service providers, it will stay at 20lakh and 10lakh in special category states.
The council has declared to continue with twin structure with two slabs. That which is said that
like the states will have an option to “opt up” to a higher limit and “opt down” in case of erosion
of assessed.
More than 2m Eligible for Exemption
In the case of the present decision announced would make more than 2 million businesses eligible for exemption.
The council allowed Kerala to Levy a 1 percent disaster-cess on the intra-state sale of goods and services for a period of two years to stabilize the revenue to meet the cost of rehabilitation parts of states that were devastated by floods last year.
The revenue bounce of this move is calculated to be Rs, 6000 core on an annual basis for the every advance received is taxable under GST Communities with a turnover of Rs 20 lakh – 40 lakh form 20 percent of GST Filers and contribute less than 3 percent of the overall collection.
COMPOSITION SCHEME
Service providers who have an outline of keeping 50 lakh for registering under the composition scheme and increasing the threshold up to Rs 40 lakh at the same time do not make sense for those having (ITC) Input Tax Credit. For good dealers, the upper limit of turnover to become eligible for the composition scheme will be lifted to 1.5 crores from the next upcoming financial year. Adding to this composition dealers will need to find GST returns only annually, but pay tax quarterly from 2019-20.
