ALSO READOnly 62 items likely to stay in 28% GST slab GST Council clears all 9 rules for new tax regime at Srinagar meeting GST will not push real estate prices up, feel industry experts Only luxury and 'sin' items could be left in highest slab From quarterly returns to exporters' e-wallet: 5 steps GST Council can take
The Goods and Service Tax (GST)Council, the top decision-making body for the new indirecttax regime, is set to amend some rules when it meets on Thursday in Guwahati. In its latest attempt to make it easier for businesses to comply with the tax law, the GST Council will aim to incentivise digital payments and might move a major chunk of items from the top 28% tax slab. The meeting, on Thursday and Friday, is being attended by 24 states and is the 23rd such meeting of the council.
As many as 165 such items could be moved to the 18 per cent category, with only 62 attracting the highest rate, as reported earlier. The items which will remain in the highest category could include digital cameras, shaving creams, paints and varnishes, cigars, pan masala, chocolates, cosmetics, vacuum cleaners, refrigerators, washing machines, hair-conditioning items, hair dyes, and marble and granite.
Here are the top developmets that can be expect fro the GST council's meeting:
1. Digital push: After one year of demonetisation, the government will again try to push for digital payments by providing incentives in the Goods and Service tax for making digital payments. This could be done as a credit or exemption or by providing merchant discount rate which is the charge levied on digital payments (ranging from 0.25% to 1%), Economic Times said.
2. Scrapping Section 9(4) of CGST: GST Advisory committee which was constituted to suggest changes to the GST law on Wednesday had deliberated on the issue of doing away with Section 9(4) of CGST Act which deals with reverse charge mechanism, Business Standard had reported. The Council's meet today result in this suggestion of the Advisory body taking effect.
3. Shift in tax slabs: Most items in the highest tax slab of 28% could be moved to lower brackets with only 62 items likely to remain in the slab. Some common items might also have their rates slashed from 18 per cent to 12 per cent, as demanded by states such as West Bengal.
4. Bringing real estate under GST: At the Friday meeting, the Council will also have a presentation about the inclusion of real estate under the new indirect tax regime. Reducing the compliance burden on taxpayers would be a part of the exhaustive agenda. A presentation will be made on the inclusion of real estate in the GST. The approval of states is key as stamp duty and registration fees on property are the exclusive domain of states according to law and will need an amendment to the Indian constitution.
5. Quarterly return filing: The Council might also allow quarterly return filing for all taxpayers, with monthly tax payment. This was suggested in a report prepared by the group of ministers (GoM), led by Assam Finance Minister Himanta Biswa Sarma. This will be helpful to traders in compliance.
In its last meeting, the Council had allowed quarterly return filing and tax payment for those with an annual turnover of up to Rs 1.5 crore.
6. Cut in late filing fees: Additionally, a reduction in late filing fees to Rs 50 per day, against Rs 200 at present, may also be considered. For traders, the report recommended a lower rate of 0.5 per cent in the case of a cumulative turnover of exempted and non-exempted goods, and 1 per cent for non-exempted goods.
7. Uniform tax rate: GST Council may also make uniform the GST rate on job work for all sectors and bring it to 5% or nil, Hindu Business Line had reported. Complying with different rates of job work has been a daunting task to businessmen as they are trying to classify their goods in the lower tax bracket wherever possible.
8. Same tax rate for AC, non-AC restaurants: The GST council may also iron out both AC and non AC restaurants in one tax bracket of 12% and bring uniformity in the sector.
ALSO READ: News digest: 62 items likely to stay in 28% GST slab, and more