Only 35 goods remain in the highest GST slab, threshold for quarterly filings raised

• The GST Council has pruned the 28 per cent slab by cutting tax rates on 191 goods over the last one year, leaving just 35 items, including AC, digital camera, video recorders, dishwashing machine and automobiles, in the highest tax bracket.
• There were around 226 goods in the 28% category when Goods and Services Tax (GST) was implemented on 1 Jul 17.
• Over the last one year, the Council, chaired by Union Finance Minister and comprising state ministers, has slashed rates in 191 items.
• The 35 goods, which will be left in highest slab once the new GST rates are implemented from 27 Jul 18, also include cement, automobile parts, tyres, automobile equipment, motor vehicles. yachts, aircrafts, aerated drinks, betting and demerit items like tobacco, cigarette and pan masala.
• Experts said going forward as the revenues stabilise, the Council may look at further rationalisation of the 28% slab, to restrict the highest tax slab to super luxury and sin goods.
• After the latest rounds of rate cuts by the GST Council on 21 Jul 18, only 35 items are left in the 28% tax slab, an official said. “The rate cuts would lead to a revenue loss of about INR60bn,” the official said.
• The GST Council also opted to reduce the biggest niggle for businesses by allowing quarterly filing of returns by those with annual turnover of up to INR50mn, a move that will benefit nearly 90% taxpayers.
• The move was part of a series of steps to ease the compliance burden taken over the last few months and will do away with the current requirement of monthly filing which businesses have said is cumbersome and time-consuming.
• “Quarterly returns for taxpayers with turnover up to INR90mn, which comprise 93% of taxpayers, will definitely reduce the compliance burden of small dealers and assist them in channelizing their energy in doing business rather than worrying about monthly tax filings,” said Harpreet Singh, indirect tax partner at KPMG.
• Further, reverse charge mechanism, a tool to track small business that are not required to register for GST, will remain suspended by a year until Sep 19, the minister said, while announcing several other procedural changes.
• Plus, a window for migration of tax payers on earlier indirect tax systems to GST is also being opened till 31 Aug 18 along with a simpler exit option for those who are no longer in business with more steps likely with the Council meets on 4 Aug 18 just to discuss issues related to MSMEs, which are seen to have been hit adversely by the new tax regime.
• In a relief to small businesses in several states, including Uttarakhand, Assam, Himachal Pradesh, Arunachal Pradesh, Meghalaya and Sikkim, the GST Council also decided to double the threshold for registration to INR2mn, a cap available for most states barring hilly and those in North-East.

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External Link: https://economictimes.indiatimes.com/news/economy/policy/gst-council-oks-quarterly-filings/articleshow/65088290.cms