The Goods and Services Tax (GST) Council in its 28th meeting will consider reduction of rates for more than three dozen goods including items classified under ‘handicrafts’.
The Goods and Services Tax (GST) Council in its 28th meeting will consider reduction of rates for more than three dozen goods including items classified under ‘handicrafts’. Although the agenda circulated for Saturday meeting doesn’t include bringing natural gas and the ATF under the GST, government officials said discussion on this issue could also be taken up if time permits.
The fitment committee has recommended exempting sanitary napkin and deities made of marble/stone from the GST – these attract 12% GST now. The GST rate for lithium-ion batteries, used in portable electronic and electric vehicles, could be brought down to 18% from 28%. Similarly, the tax rate for refrigeration equipment used in the leather industry, ice-making machinery and water cooler could be slashed to 18% from 28%. Bamboo flooring can also see a rate cut from 18% to 12%.
The GST Council had earlier argued against exempting sanitary napkins citing blockage of input tax credit (ITC) to manufacturers, making it unviable against imports. However, the fitment committee is believed to have agreed to exempt the status as the product is an essential item for health and hygiene.
Among handicraft items, the rate for handmade carpet, lace and tapestries has been recommended to be reduced to 5% from 12%. Additionally, artware made of brass, copper, glass, stone, glass statues and ornamental framed mirrors may attract 12% from 18% currently, officials said.
Besides, the Council is likely to discuss and approve the final design of simplified return filing forms. It is expected that new return-filing forms would be implemented by the end of this year. It had approved the basic contours earlier. Additionally, more than 40 amendments to the GST Act will be placed before the Council for approval before being placed before Parliament in the ongoing monsoon session.
Sources said the Council may propose to constitute the GST Appellate Tribunal with one national bench and three regional benches at Chennai, Kolkata and Mumbai. After seeking the recommendation of the GST Council, approval would be taken for creation of necessary posts of chairmen and members.
As FE reported earlier, the Council would also consider reports of various group of ministers and approve recommended solutions for improving return filing, quicker liquidation of accumulated integrated GST (IGST) as well as the report on revenue trend for the first quarter of the fiscal.
Sources said it has been proposed to levy a late fine for GSTR-1 (outward supply return) filing as the number of taxpayers filing it has dwindled. Similarly, it has also been proposed to amend the GST Act to mandate utilisation of IGST credit first to discharge liability of central and state GST before CGST and SGST credit are used. This is expected to bring down nearly Rs 1.2 lakh crore of accumulated IGST.