32nd GST Council Meet – News Updates & Highlights

Latest update on 10th January 2019

The 32nd GST Council meeting was held on 10th January 2019 at Delhi. It was chaired by the Finance Miniter Shri Arun Jaitley.

Highlights of 32nd GST Council Meet

  • GST Registration

    Basic exemption limit for suppliers of goods will be increased from Rs 20 lakhs to Rs 40 lakhs. However, this limit remains Rs 20 lakhs for suppliers of services. For the special category States, the limit for registration is currently at Rs 10 lakhs. This limit in case of supply of goods is increased up to Rs 20 lakhs and such States have been given an option to either choose Rs 40 lakhs or Rs 20 lakhs threshold limit in a week’s time.
  • New Composition scheme for Services providers

    Those suppliers rendering either independent services or providing a mixed supply of goods & services with a turnover of up to Rs 50 lakhs p.a in the preceding financial year, can join this scheme. The Tax rate is fixed at 6% (3% CGST +3% SGST).
  • Changes to existing Composition scheme

    • Increase in the limit to opt into the scheme will be increased up to Rs 1.5 crore effective from 1st April 2019.
    • Tax to be paid Quarterly and GST Returns to be filed annually.
  • [Note: The effective changes to Composition scheme for both suppliers of goods and services will apply from 1st April 2019]    
  • Consensus received for charging calamity cess in Kerala

    Kerala has been given an approval to charge Disaster/calamity cess of up to 1% on all the intra-state supplies of goods and services within Kerala, for up to two years
  • GST Rate cuts

    • No changes in GST Rates until Revenue spikes, recommended by the GST council
    • No GST rate cut on sale of under construction flats. Instead, a 7 member group of ministers is formed to study the implications of reducing the rates from 12% to 5% on supply of such under construction properties.
    • Further, No GST rate cuts on the Private lottery distributions. A Group of ministers will be formed with representatives from developing and selling states
  • Extension of GST practitioner exam

    The last date for passing the examination for GST Practitioners to be extended till 31.12.2019 for those GST Practitioners who have enrolled under rule 83(1)(b) i.e. who were sales tax practitioner or tax return preparer under the existing law for a period of not less than five years.
  • Free Accounting and Billing Software shall be provided to Small Taxpayers by GSTN.

32nd GST Council Meeting:

10 things to know In the 32nd GST Council meeting, held on January 10, 2019, the council proposed various relief for MSME sector such as widening the scope of composition scheme, simplification of compliances, free accounting-cum-billing software for small taxpayers, so on and so forth. All these proposals would be effective from the April 1, 2019. 10 Key takeaways of 32st GST Council meeting are as follows :

1. MSMEs engaged in supply of goods (not services) get relaxation from GST Registration. The existing threshold limit of Rs. 20 lakhs for obtaining the GST registration and levy of GST has been increased to Rs. 40 lakhs. The GST Council Meeting has given a choice to the States to choose the applicable threshold limit from Rs. 20 lakhs or Rs. 40 lakhs.The States have to take a decision on this within a week. No such relaxation has been given to supplier of services.

2. The Govt. shall provide a free accounting-cum-billing software to small taxpayers.

3. The limit of annual turnover, in the preceding financial year, for availing of the compositions scheme for goods has been increased from Rs. 1 Crore to Rs. 1.5 Crores For Special category states, the Council has given the liberty to the States to decide independently about the threshold limit within one week.

4. Currently, composition suppliers are required to file GSTR 4 on quarterly basis. The Council has proposed to simplify the compliance procedure for such suppliers. The suppliers shall now be required to file just one return on annual basis, while as the payment of tax shall continue to be on quarterly basis. It is not clear whether annual return to be filed by composition supplier in Form GSTR-9A shall continue or not.

5. The option to avail of composition scheme has been extended to service providers who have the turnover of up to Rs. 50 lakhs during the previous financial year. Under this scheme, the service providers shall be liable to pay GST at the rate of 6% (3% CGST + 3% SGST). The said scheme shall be applicable to both service providers as well as suppliers of goods and services.

6. A new cess at the rate of 1% shall be levied on intra-state supply of goods or services within the state of Kerela for a period of not exceeding 2 years for revenue mobilization for natural calamities Council has asked the group of ministers to evaluate the proposal of extending the composition scheme to real estate sector so as to give a boost to residential housing segment.

8. The Council has also asked the group of ministers to examine the GST rate structure on Lotteries 

10. Last date for passing the examination for GST practitioners has been further extended
till December 31, 2019.

9.All the proposals made in 32nd GST Council Meeting shall be effective from April 1, 2019. The Council has clarified that the changes made by GST Amendment Act would be applicable from February 1, 2019.

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