GST Council decides to reduce compliance burden of small traders

GST Council decides to reduce compliance burden of small traders

GST Council decides to reduce compliance burden of small traders

The Council made a decision to form a group of finance ministers (GOM) to discuss issues including, allowing inter-state traders under composition scheme, reducing GST on restaurants and exempting zero rated goods in calculation of turnover.

This scheme is optional under the manufactures other than those of ice creams, pan masala and tobacco products have to pay a 2 percent tax on their annual turnover.The tax rate would be 5 percent for restaurant and 1 percent for traders.

He said that composition scheme limit has been increased from Rs 75 lakh to Rs 1 crore and added that 1% tax is applicable on traders under composition scheme.

Those who have more than Rs. 1.5 crore turnover, they, according to the old circle, GST 1, GST 2, GST 3 will file according to that monthly.

Jaitley, however, said, "For small traders the tax burden is low, but the compliance pressure is greater".

Kerala Finance Minister Thomas Isaac said exporters will get IGST relief and e-wallet facility for six months. This will be initiated on April 1, 2018, he said. GST Council has also thought of bringing down tax rate on AC restaurants with no ITC from 18 per cent to 12 per cent. The council slashed tax on 27 items, including unbranded Aurvedic medicines. The council will then recommend some relaxation so that the working capital of exporters that is locked up in refunds is released.

Exporters' tax refunds, which have been pending, will be cleared over the next two weeks - those for July by October 10, and for August by October 18.

The Council is also expected to take up proposals regarding suspension of the reverse charge mechanism.

The panel chose to reduce tax rates for items including diesel engine parts, man-made yarn, ready-to-eat snacks, plastic and paper waste.

"So far, over 15 lakh out of the 90 lakh registered businesses have opted for the composition scheme", he added.

Prime Minister Narendra Modi, while defending his government's track record in managing the economy, on Wednesday said that both demonetisation and the implementation of GST were structural reforms.

The GST Council has also set up a Group of Ministers to look into various issues - including whether, when calculating the tax burden of a business, its total turnover should be considered or should exempted goods first be excluded.

Director-general Datuk Seri T. Subromaniam said the latest amendments to the GST Act had been submitted to the Finance Ministry and are expected to be tabled in the Dewan Rakyat later this month.

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