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GST

SMEs are stuck in the GST  spider web, why? The regime is simply undergoing changes every now and then, the lack of not having a accounting and secretarial advisory is putting pressure on these businesses. This blog intends to make life easier for these guys, New Rules in the GST Game that Businesses should know.

As per 22nd GST Council meeting of 6th October 2017:

Lesser burden of compliance for small businesses

  • The government has recognised hardship faced by small businesses with turnover of within Rs 1.5cr, by delaying their return filing compliance to once a quarter from once a month. Taxes will be paid quarterly.
  • Small businesses will also have to file monthly returns for three months – July, August, and September – and the switchover to quarterly filing will happen from the cycle starting October 1.

 

Relief for Service Providers

  • Exemption from Registration for a service provider if the aggregate turnover is less than Rs. 20Lacs (10 Lacs in special category state except for J&K) even if they are making inter-state supplies of services.
  • Services provided by a GTA to an Unregistered person shall be exempted from GST.
  • TDS/TCS provisions shall be postponed till 31.03.2018.
  • Small businesses will also have to file monthly returns for three months – July, August, and September – and the switchover to quarterly filing will happen from the cycle starting October 1.

 

Relief for Exporters

  • Refund cheques for July exports will be processed by Oct 10 and refund cheques for August exports will be processed by Oct 18.
  • Every exporter will now get an e-wallet. In the e-wallet, there would be a notional amount for credit. The refund they will eventually get will be offset from that amount. The e-wallet will be introduced from April next year.
  • Merchant exporters will pay a nominal 0.1% GST applicable on exports to enable their suppliers to claim ITC.

 

 

Composition Scheme changes

  • Person otherwise eligible for availing the composition scheme and are providing any exempt services shall now be eligible for the composition scheme.
  • Eligibility of composition scheme raised to INR 1 crore.
  • Traders will pay 1%, manufacturers 2% and restaurants 5% under the composition scheme.
  • Due date of FORM GSTR-4 for the quarter July-September, 2017 is extended to 15th November 2017

 

Under consideration 

  • Finance Minister Arun Jaitley announced that a group of ministers will relook tax on AC restaurants. GST for AC restaurants may become cheaper from 18% to 12%. A group of ministers has been formed to devise the mechanism. The GoM will submit its report in 14 days.
  • GoM will also make the composition scheme more attractive

Next meeting of the council will take place in Guwahati on 9-10 November.

 

RCM postponed

RCM applicable for the purchases from the unregistered dealer shall be suspended till 31.03.2018.

 

No GST on advance receipts for businesses with turnover under INR 1.5cr

Taxpayers having annual turnover upto 1.5 Crore shall not be required to pay GST at the time of receipt of advances on account of supply of goods.

 

Significant rate changes

  • GST on unbranded Ayurvedic medicines has been reduced from 12% to 5%.
  • Tax rate for man-made yarn has been reduced to 12% from 18%. The decision will have an effect on textiles.
  • GST rate on many job work items reduced from 12% to 5%. GST rate on some stationery items, diesel engine parts also reduced to 18% from the earlier 28%.
  • GST on khakra and unbranded namkeen has been reduced from 12% to 5%. Tax on zari work has been reduced from  12% to 5%.
  • 35% abatement on old leasing contract of vehicle
  • Printing Job work rate revised from 12% to 5%

 

Others

  • E-way bill has been deferred to 1stApril 2018
  • Relief for jewellers as no need to furnish PAN card on jewellery purchase of more than Rs 50,000. The amount of jewellery purchase for which KYC will be required will be determined later.
  • 35% abatement on old leasing contract of vehicle
  • Due date of GSTR-6 (filed by an input service distributor) for the months of July, August and September 2017 has been extended to 15.11.2017

 

Central Tax Rate Notification (28.06.2017)

  • Most of the goods are kept at the same rates as announced by the GST councilearlier but rough or non industrial unworked diamond or precious stones will be charged CGST at the rate of 0.125%.
  • List of goods exempt from CGST. No change in the list.
  • Oil, gas, coal and petroleum licenses and sub-contract licenses and leases will be charged GST at the rate of 2.5%.
  • The person liable to deduct TDS as per the GST law supplying intrastate goods or services to an unregistered person would be exempt from CGST.
  • Cashew nuts, not shelled or peeled, Bidi wrapper leaves (tendu), Tobacco leaves, silk yarn, Supply of lottery would have reverse charge applicable under GST.
  • Refund of the unutilized ITC would not be provided in the case of the tax on output being lower than the tax on inputs for certain goods mainly related to the textile and railways.
  • The supply of goods by CSD to unit run canteens and authorized customers and supply of goods by the unit run canteens to the authorized customers.
  • 50% of the tax paid on inward supplies of goods by the CSD for further supply to unit run canteens or authorized customers can be claimed as refund under GST.
  • Person liable to deduct TDS as per the GST law supplying intra goods or services to an unregistered person would be exempt from CGST.
  1. Intrastate supply of second hand goods by a registered person who deals in selling second hand goods to an unregistered person would be exempt from CGST.

 

News on GST Act

The entire framework of GST is based on GST Act. It was devised by the GST Council, which is a committee consisting of the Union Finance Minister (Chairperson), the Union Minister of State, the minister in-charge of finance or taxation or any other minister nominated by each State Government.

 

E-Way Billing

The GST provision, requiring any good more than Rs 50,000 in value to be pre-registered online before it can be moved, is likely to kick in from October after a centralised software platform is ready, a top official said. 

The provision, called the e-way bill, would be implemented after infrastructure for smooth generation of registration and its verification through hand-held devices with tax officials is ready. 

 

The GST is a constitutional amendment, and any change in the law will also affect the rules therein. Rules for invoicing, rules for penalty, rules defining the point of taxation – these are just some of the examples of any rule change in the model law. We at Wazzeer will be happy to help you out, experience Wazzeer virtual advisory system, let’s connect!

 

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