The Logistics Headlines,New Delhi, 4th March :The Goods and Services Tax (GST) Council today in a meeting at Vigyan Bhawan, New Delhi had honorable presence of Mr. Arun Jaitley (Union Minister of Finance & Corporate Affairs) that approved the draft IGST (Integrated Goods and Services Tax) Bill and draft CGST (Central Goods and Services Tax) Bill, as referred by the Union Law Ministry. Now these two bills can be taken to the Parliament by the Central Government to clear out other relevant procedures in further Budget Sessions.
Listed Below are some of the Prime Features of the Two Bills approved by the GST Council:
- A state-wise sole registration is enough for taxpayers to pay taxes, meet compliance requirements, and file returns. Majority of compliance requirements can be made online, thus physical interface will be reduced between the tax official and taxpayers.
- To report their supplies (exported of country or made in or outside the state), taxpayers must state-wise file one single return for paying the applicable taxes, which can be State Good and Services Tax (SGST), Central Goods and Services Tax (CGST), Integrated Goods and Services Tax (IGST), or Union Territory Goods and Services Tax (UTGST).
- Business entities with up to Rs. 20 Lakhs as annual turnover are not required for registration under GST regime, unless they choose to be a part of ITC (input tax credit) chain. For Special Category States (as specified in Article 279A of the Constitution like that of Sikkim, Himachal Pradesh, Uttarakhand, Assam, Arunachal Pradesh, and other North Eastern states), the annual turnover threshold for not taking GST regime registration will be Rs. 10 Lakhs.
- Business entities with up to Rs. 50 Lakhs turnover can benefit from composition scheme, which will allow them to pay a much lower tax rate for complying with only minimal requirements. Select manufacturing sectors, restaurants from service sector, but all traders can avail the Composition Scheme.
- ITC is permitted on every goods and services used business journey or its advancement to prevent cascading of taxes. The facility will be excluded for few items as stated under the Law.
- ITC entitlement from taxes paid under the Central Law could be cross-utilized to pay taxes being covered by the laws of Union Territories or States. For example, taxpayers can utilize ITC amassed on them because of IGST payment for discharging their tax liability of SGST/CGST/UTGST. In addition, taxpayers can use this amount to account for the payment of SGST/CGST/UTGST for IGST payment. These payments have to be done in a pre-verified order.
- Retention of the Input Service Distributor (ISD) mechanism in services sector, which was under the Service Tax Law, will allow ITC flow to input services falling within legal entity.
- Terms constructed for benefit of exporters to prevent lock-in of capital and make refunds in seven days of application filing for refund initiated by an exporter. On provisional basis, ninety percent of claimed amount can be disbursed.
- Provision made to promise single administration interface for all taxpayers for authorizing tax administration officers from State and Center so that they can implement powers under all Acts.
- Registration under GST regime is not mandatory for agriculturists who supply produce from their cultivated land.
- Provision generated for bringing certainty in tax matters for Advance Ruling Authority.
- Application of end number of provisions in regards to Apellate mechanism.
- Transitional provisions put in detail for easy transfer of unutilized ITC for GST regime and migration of existing taxpayers.
- Incorporation of anti-profiteering provision for tax reduction facility can be completely enjoyed by the consumers.
- Commissioner will allow instalment payments for taxes to reduce financial difficulties suffered by taxpayers.
The Union Territory Goods and Services Tax (UTGST) similar to CGST Act, and Stage Goods and Services Tax (SGST) will be considered for legal vetting in the GST Council meeting to be held on the March 16th, 2017.