Finance Minister Nirmala Sitharaman said on Friday that no late fees will be levied on entities that have zero Goods and Services Tax liability but have not filed their returns between July 2017 and January 2020, Hindustan Times reported. Sitharaman added that a fixed late fee of Rs 500 will be charged from entities that have a tax liability but have also not filed returns between the same period.
Sitharaman made the announcement after a meeting of the GST Council via videoconferencing. The Goods and Services Tax regime was born on July 1, 2017, replacing a bunch of indirect taxes.
The finance minister announced that small taxpayers with a turnover of less than Rs 5 crore will now pay a reduced rate of interest of 9% for returns filed for February to April 2020 after July 6, if filed by September 30. Earlier, the interest rate was 18%. These taxpayers can also pay tax for May to July 2020 by September 30, and no late fee will be charged, she added.
The finance minister added that the GST council will meet in July again to discuss the compensation cess to be given to the states, according to The Economic Times. “We’ll discuss if market borrowing is needed to sort the issue and if yes, how should it be done,” Sitharaman was quoted as saying by the newspaper.
This was the first meeting of the GST Council held via videoconferencing, due to the ongoing coronavirus pandemic.
During the GST Council meeting held in March, the tax rate on mobile phones and their specific parts were increased from 12% to 18%. The Council, in its 39th meeting, gave relief to domestic maintenance, repair and overhaul service providers by slashing the tax rate from 18% to 5% with a full input tax credit.
The Council also decided to extend the deadline for filing of GST9R and GSTR9C for the year 2019-’20 till June 30 from the original date of March 31.