The GST Council today decided to raise the revenue threshold under the composition scheme to Rs 1 crore from Rs 75 lakh at present.
The GST Council today decided to raise the revenue threshold under the composition scheme to Rs 1 crore from Rs 75 lakh at present, Finance Minister Arun Jaitley said. This is expected to bring big relief to many more small businesses, who will have the convenience of paying a flat rate of 1%, 2% or 5%, and avoid a lot of paperwork.
Albeit, this might also come as a disappointment to many, as it was being widely speculated that the limit would be raised to Rs 1.5 crore in today’s meeting. Those in the business of trading with revenue of up to Rs 1 crore a year will pay a flat tax of 1%; manufacturers will pay 2%; while restaurants will pay 5%, Arun Jaitley said.
The 22nd meeting of the GST Council was held in New Delhi today. The meeting was third since the implementation of the Goods and Services Tax in July this year. The council, headed by Finance Minister Arun Jaitley, provided wide ranging relief to exporters and small businesses alike by taking measures to simplify processes, reduce compliance burden and improve liquidity situation.
The council responded favourably to the the call by small businesses to lower the compliance burden by allowing them to file returns only once in a quarter instead of once every month as is required at present. Further, for exporters reeling under tight liquidity conditions due to tax refund claims aggregating to Rs 65,000 crore stuck with the government, the GST Council took steps to provide them relief by allowing pre-GST exemptions for them till March 2018.
The GST Council decided bring in an e-wallet facility after six months to speed up their refund claims. Further, the government has also decided to exempt exporters from IGST for next six months. Exporters need to pay IGST on import of their inputs, and claim refund from the government under rules. Under the proposed facility, the government would immediately transfer the tax credit claims by way of notional amount in the e-wallets. Exporters would be able to use that amount for payment of their taxes, Arun Jaitley said.
Further, as for the refunds for the first two months of the GST stuck with the government, Arun Jaitley said that it will start disbursing the refund cheques to the exporters for the month of July by October 10, and that for the month of August by October 18.