Businesses with a turnover of up to Rs 1.5 crore can now file returns quarterly instead of monthly, the Goods and Services Tax Council announced on Friday. Such businesses comprise nearly 90% of all assessees, Finance Minister Arun Jaitley said.
Jaitley announced a slew of revisions in rules under the new indirect tax regime. Most revisions – discussed at the 22nd meeting of the GST Council he chaired – target small and medium enterprises and exporters, who had made representations to the GST Council about problems they faced.
The annual turnover threshold for the composition scheme has been increased to Rs 1 crore from Rs 75 lakh. The tax rates under the scheme will be 1%, 2% and 5% for traders, manufacturers and restaurants.
By opting for the composition scheme, small taxpayers can avoid tedious paperwork and pay GST at a fixed rate of their turnover. So far, more than 15 lakh of the 90 lakh businesses registered under the GST network have opted for the composition scheme, according to PTI.
The tax rate on 27 items, including yarn, Anganwadi food packets, some food items, paper waste, unbranded Ayurvedic medicines and stationery items, have been lowered.
A few other decisions made on Friday include the following:
- The reverse charge mechanism has been suspended till March 2018. Under this, the recipient of the goods and/or services was liable to pay the GST instead of the supplier.
- A Group of Ministers will consider revising the 18% GST rate on air-conditioned restaurants with a turnover of more than Rs 1 crore.
- Petroleum products remain outside the ambit of the GST.
- Exporters will get refunds through an e-wallet from April, with a notional amount for credit with advance tax refund. They will begin to get their GST tax refund cheques from October 10.
The GST Council’s meeting comes just days after Prime Minister Narendra Modi had said he had asked the committee to review the problems traders were facing, and that the government was willing to make changes accordingly.