Taxation

GST Council Meet: 50% Compliance Burden Reduced, Tax Cuts and More

The GST Council Meeting has decided to remove 178 items from 28% tax slab keeping only 50 items out of 227 items. All the new amended rates would be applicable from November 15, 2017. Compliance has also been eased by 50% for the businesses to cheer.

GST Council Reshuffles Tax Slab for Consumers

In this GST Council Meet, the government has reshuffled items from tax slabs. 13 items have been moved from 18% tax slab to 12% slab. 6 items have been moved from 18% tax slab to 5% tax slab. 8 items have been moved from 12% to 5% tax slab while 6 items have been moved from 5% tax slab to Nil apart from 178 items that have been removed from 28% tax slab. Only 50 items will remain in the 28% tax slab which is the highest tax slab in GST.

Restaurants to Come Under 5% Tax Slab

Something unexpected came from the council meet where the council reduced the 18% tax slab from restaurants to 5% which was expected to be 12%. The 5% tax slab would be applicable for both AC and Non-AC restaurants. The council said that restaurants won’t get benefit of ITC which earlier they used to get because they didn’t passed the benefit to the customers. The council also noted that Hotels charging Rs 7500 or more as room tariff per night will come under 18% tax slab and even outdoor catering would be subject to 18% tax rate.

Compliance Relief for Businesses

  • Late filling charges have been reduced. Late NIL returns will be charged Rs 20 per day while normal late returns will be charged Rs 50. Earlier the charge was Rs 200 per day irrespective.
  • No GSTR 2 and 3 for financial year 2017-18. GSTR-3B to continue till March 2018. Tax Payers will have to file only GSTR-1 and GSTR-3B till March 2018.
  • Tax payers with annual turnover of up to Rs 1.5 crore will have to file GSTR-1 return quarterly while tax payers with annual turnover of more than Rs 1.5 crore will have to file monthly GSTR 1.
  • Tax payers below the turnover of Rs 1.5 crore will have to file the returns of July-Sept by December 31, 2017. Returns for the month Oct-Dec to be filled by Feb 15, 2018 and for Jan-March, returns to be filed by April 30, 2018.
  • Tax payers with turnover of more than Rs 1.5 crore will have to file the return of July-Oct by 31st December 2017.
  • 40 days period for filling invoices. Invoices of November 2017 to be filled by January 10, 2018 while for December and January, Feb 10 and March 10 respectively.
  • 30-40% returns filed untill date are NIL rated making it easier to file.

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