GST Council had its 37th Meeting on 20th September 2019. In this meeting several decisions and recommendations made to make GST more simplified for the registered person. These decisions include relaxations in annual return filing for the small taxable person, Revision of GST rate, changes to composition scheme, new GST exemptions introduced and some clarifications. In this article we will discuss all the major decisions which are as follows:
1. Waiver of Annual return for Composition Taxpayers in GSTR-9A for FY 2017-18 & FY 2018-19
As per section 44 read with rule 80 of CGST Rules, the person opted for Composition scheme shall have to file its annual return in form GSTR-9A. In the meeting, there is an exemption has been provided to all those composition suppliers from the filing of annual return in form GSTR-9A for the financial year 2017-18 and 2018-19. It might be possible that this return will be totally vanished since now form GSTR-4 is being used for checking the annual declaration of turnover and tax details.
2. GSTR-9 for small taxpayers now not compulsory for FY 2017-18 & FY 2018-19
Those taxable persons whose annual turnover is up to Rs.2 crore in FY 2017-18 or FY 2018-19, may choose to not file GSTR-9, from the date to be notified by CBIC. However, if their annual turnover exceeds Rs.2 Crore then they have to file the annual turnover up to 31st December of the following year.
In the meeting, GST Council has decided to review the form GSTR-9, 9A, and 9C return. However, they must continue to file annual returns for FY 2019-2020 onwards.
3. New GST Returns Deferred to April 2020
In the 31st Council meeting, the new returns have been introduced which would be applicable from October 2019. However such new GST return system is being postponed till March 2020 and for now, these new returns shall be applicable from April 2020. Since the application of these new returns in the middle of the year became the hurdle for many taxpayers hence this decision is being appreciated by the taxpayers. Taxpayers can begin on a fresh note from a new financial year. This deferment is done for all kinds of the assessee.
4. Restrictions on ITC claim in GSTR-3B
It was noticed that the suppliers were not filing their GST returns on time and there was a delay in collecting the GST, Hence to get the information of outward supplies by taxpayers on time, the GST Council made a recommendation that input tax credit will be restricted for the recipients if the suppliers have not filed the details of outward supplies in GSTR-1 on time.
5. Circular on Post Sale Discount Withdrawn
As per the Circular number 105, dated 28 June 2019, CBIC has made a clarification that the post-sale discount for promotional activities by the supplier or secondary discounts shall not be available to the taxable person
The circular clarifies that it does not matter whether such post-sale discount has been included in the value of supply or not and whether Input Tax Credit is being reversed at the time of issuing a credit note or not in certain specified cases.
The GST Council recommended revoking of the circular number 105 with retrospective is effective from the beginning (ab-initio).
GST Exemptions announced
As per Notification number 12/2017, the council has made certain additions and certain changes in the current exemption, which are as follows:
- There was already an exemption provided to the supply of goods or services in relation to FIFA and now it has been specified for individuals for the Under-17 Women’s Football World Cup in India.
- Supply to the Food and Agriculture Organisation (FAO) for the projects as specified.
- Up to the year 2024, Imports of certain defense goods which are not made in India.
- Import of silver or platinum by Diamond India Ltd and the supply of silver or platinum by specified agencies to exporters for the purpose of export of jewelry.
- Storage or warehousing services for cereals, fruits, nuts and vegetables, spices, copra, sugarcane, raw vegetable fibers such as cotton, flax, jute, etc., indigo, unmanufactured tobacco, betel leaves, tendu leaves, rice, coffee, and tea.
- Life insurance services provided or agreed to be provided by the Central Armed Paramilitary Forces (under Ministry of Home Affairs).
- Intermediary services provided to a supplier of goods or recipient of goods when both the supplier and recipient are located outside the taxable territory.
- Those farmers who have applied for BANGLA SHASYA BIMA (BSB) crop insurance scheme of the West Bengal Government, such services shall be exempted.
Changes in GST Rates:
In the meeting, the rates in some sector have also been changed which are:
- Hospitality and Tourism
|S.No.||Tariff Rates||GST Rate|
|1||less than Rs.1000||No GST charges|
|2||between Rs.1001 to Rs.7500||12%|
|S. No.||Catering Services||Tariff Rates||GST Rate|
|1||within the premises||Daily tariff rate of Rs.7501||18% with ITC|
|5% without ITC|
|2||other than on the premises||Daily tariff rate of Rs.7501||18% with ITC|
- Job Work Services
|S. No.||Job Work Services related to||GST Rate|
|1||diamonds||1.5% (from 5%)|
|2||engineering industry (except bus bodybuilding)||12% (from 18%)|