GST revamp expected at Council's meeting today

Govt to address issues of tax returns of small-scale traders and exporters

The GST Council’s meeting today in Delhi will focus on revamping the GST to address the issues faced by small-scale industries, traders and exporters.

The Council could consider raising the threshold for the composition scheme to Rs 1-1.5 crore from Rs 75 lakh to aid MSMEs. Under the composition scheme, an entity pays a fixed, nominal rate to avoid GST-related paperwork. While the industry has sought raising the threshold to Rs 1.5 crore, the Council will consider the concerns of the Finance Ministry and some states about revenue losses. 
Higher thresholds will ease the compliance burden and also reduce the filing load on the system. Prior to the rollout of the GST, excise duty on turnover of up to Rs 1.5 crore had been exempted. The council could extend the quarterly filing facility to small businesses with a turnover of up to Rs 1.5 crore. An ‘e-wallet’ facility for exporters to get tax credit immediately on self-declaration after exports could be taken up.

Other expected measures are including only taxable items in the Rs 20 lakh exemption limit. There is now no differentiation between exempted goods and non-exempted goods while calculating this. Filing of returns could also be further simplified as part of the revamp of overall compliance to make it easier to do business, a key aim of the government. 

The council will consider steps to give relief to exporters, who are facing acute working capital shortages, as thousands of crores in tax refunds are stuck in the system. The government has already allowed exporters to export goods or services without payment of integrated GST with a letter of undertaking, barring those persons who have been prosecuted under GST or any other law in force, where the amount of tax evaded exceeds Rs 2.5 crore.

Source: ET


Add new comment