GST Council is mulling pre-GST regime benefits for exporters, says report
- Author: Rogelio Becker Oct 07, 2017,
Oct 07, 2017, 0:09
The Council made a decision to continue with two pre-GST era schemes that allow duty-free sourcing of materials for export production till March 2018, a move that will improve the liquidity of exporters by preventing their working capital from getting locked up in tax procedures. Exporters would be able to use that amount for payment of their taxes, Arun Jaitley said.
The scheme allows small businesses, including eateries, to pay 1-5 per cent tax without having to deal with the three-stage filing process.
Businesses with annual turnover of up to Rs 1.5 crore are eligible to switch over to the quarterly schedule.
E-Way bill, which was needed to transport any good valuing over ₹50,000 will not be needed till April 2018.
Krishna Byregowda, minister for agriculture and Karnataka's representative in the GST Council said the GSTN has come across 48 technical glitches till date, which have caused inconvenience to tax payers.
- Khakra and plain chapattis reduced to 5%.
- Many stones used in flooring, except marble and granite - will be now taxed at 18% instead of 28%.
"So far, over 15 lakh out of the 90 lakh registered businesses have opted for the composition scheme", he added. Under this, resturant businesses will pay GST at 5% rate, traders will pay 1% while manufacturing composition will be 2%.
- Job work items like zari will now be taxed under 5 per cent slab as against 12 per cent ealier. For the GST tax rate of 12 per cent, it is split at 6 per cent Central GST (which goes to the Centre's kitty) and 6 per cent State GST (which goes to the state's kitty). Man-made yarn's rate was revised from 18 percent to 5 percent too.
- Diesel engine parts will now attract 18 per cent GST instead of 28 per cent earlier.
The GST council will hold its 22nd meeting on Friday and is likely to consider to relaxing the return filing cycle for small and medium enterprises. Members examined the provisions and after detailed study we found that large companies/taxpayers contribute to 94-97 per cent of the taxes filed.
"So far 3.3 million businesses have filed GSTR-1 for July, while 5.3 million had filed the initial GSTR-3B returns".
Traders will pay 1%, manufacturers 2% and restaurants 5% under the composition scheme.
Jaitley also revealed that about 72 lakh taxpayers have been migrated to the GST system while 25-26 lakh are new taxpayers under the new taxation system.
The restaurants - which are of less than Rs. 1 crore turnover and which are bigger than that, that are air conditioned, they take 18 per cent tax; they claim the Investment Tax Credit (ITC), but have they decreased their claim with the ITC.