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 Kerala for a period of not exceeding 2 years for revenue mobilization for natural calamities.

7. GST 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.

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.

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