GST Council Meeting Highlights: Taxpayers with annual turnover more than 5 crore will have to provide HSN code up to 6 digits from 1 April 2021.
On the back of low revenue collection and disruptions caused by the coronavirus pandemic, the states are heading towards a GST revenue shortfall of Rs 2.35 lakh crore.
GST Council Meeting Highlights: After a day-long GST Council meeting held today, the Centre and the states could not draw consensus on the issue of borrowing to make up for compensation shortfall. Finance Minister Nirmala Sitharaman said that the next meeting will be on 12 October. However, there was various other decision taken in today’s meeting. As per the latest revision, instead of Rs 97,000 crore, Rs 1.1 lakh crore will be given in Option 1 for the states’ borrowings. Also, Rs 20,000 crore GST compensation collected this year will be disbursed by tonight. Further, from 1 January 2021, small taxpayers with annual turnover less than Rs 5 crore will not be required to file monthly returns, reducing their compliance burden from filing 24 returns to 8 returns. However, payments by those taxpayers will be made through challan every month. On the other hand, the compliance burden for large taxpayers has been increased as they will have to provide HSN code up to 6 digits while small taxpayers will have to provide HSN code up to 4 digits for B2B transactions from 1 April. Meanwhile, the refunds will be given only in bank account validated with PAN and Aadhaar details from 1 January 2021.