GST

GST Council 23rd Meeting: Major changes in GST Rates

Decisions are taken in 23^rd GST Council meeting held at Guwahati, Assam on 10/11/2017

In the 23^rd GST Council Meeting, the council members have come up with the decisions related to extensions of GST returns due dates, rationalization of the GST Rates, ITC eligibility criteria,  Notifications and exemption relating to Composition Scheme under GST  and much more. This article is describing GST Council 23rd Meeting.

Changes in GST Return Filing Due Date

1. GSTR 3B return filing due to date change:

GSTR 3B is the simple return which includes details of sales and purchases for the respective month. As per the 22^nd GST Council meeting, it was announced that GSTR 3B must be filed by all the registered taxpayers until December 2017.

However, as per the 23^rd GST Council meeting held it is announced that GSTR 3B must be from July 2017 to March 2018 on monthly basis before 20^th of every month

2. Change in GSTR 1 due date:

Until March 2018 GSTR 1  is to be filed by the following due dates monthly:

Sr.No.	Monthly	GSTR 1 Due Date
1	July 2017	31st December 2017
2	August 2017	31st December 2017
3	September 2017	31st December 2017
4	October 2017	31st December 2017
5	November 2017	10th January 2018
6	December 2017	10th February 2018
7	January 2018	10th March 2018
8	February 2018	10th April 2018
9	March 2018	10th May 2018

Entities registered under GST and having a turnover of less than Rs. 1.5 crore is given an option to file quarterly returns on following due dates:

Sr.No	Quarter	GSTR 1 Due date
1	July  to September 2017	31st December 2017
2	October to December 2017	15th February 2018
3	January to March 2018	30th April 2018

3. Change in GSTR 2 and GSTR 3:

The requirement of filing GSTR 2 return and GSTR 3 has been suspended until further notice received from the government. However, it is mandatory to file GSTR 1 as per the schedule provided above.

4. Waiver of Penalty:

The government has waived the late filing penalty for GSTR 3B for the month of July, August and September 2017. In case any taxpayer hah already paid the penalty, the penalty would be credited to the electronic cash ledger.

5. Reduction of GST Return Penalty

In addition to the waiver of GST Return Penalty, the government has also announced a reduction in GST Return penalty for NIL GST Return. From October 2017 onwards the GST return penalty for not filing NIL GST return has been reduced to Rs.20 per day instead of Rs.200 per day.

6. Change in GSTR 4 return:

• The original due date for filing GSTR 4 under the Composition scheme was due on 18th of October, January, April, and July
• Now, GSTR 4 for the July to September 2017 quarter will be due only on the 24th of December 2017. The due date for subsequent quarters will be announced by the GST Council at a future date.

7. Change in GSTR 5 return:

• GSTR 5 has to file every person registered under GST as a non-resident taxable person. Previously GSTR 5 was due on 20^th of every month
• However now for GSTR 5 and GSTR 5A, the due date for the month of July 2017 has been extended until 11^th December and 15th December 2017.

8. Changes in GSTR 6 return:

GSTR 6 has to be filed by input service distributor which was originally due on 13^th of every month. This has now extended until 31^st December 2017

9. Changes in GST Tran 1 due date:

The due date for filing GST TRAN-1 has now been extended until 31st December 2017. Any registered taxpayer who has filed GST TRAN-1 can also now revise their return until 31st December 2017.

10. Changes in GST ITC 04 return:

The due date for filing GST ITC-04 for the July to September 2017 quarter has now been extended until 31st December 2017.

Changes in GST Rates for Goods

1. In GST Council Meeting, rates for 178 items have been reduced from 28% to 18%. GST Rate has reduced from 28% to 18% as per the list below:

S.No.	Items
1	Building Material which includes the following:   – Wire and insulated conductors which also includes electrical insulators, electrical plugs, switches, sockets, cables, fuses, relays, electrical connectors. – Electrical boards, panels, consoles, cabinets etc for electric control or distribution. – fiber boards and plywood. – The article of the wood, wooden frame, paving block. – Sanitary ware and parts thereof of all kind – Slabs of marbles and granite – Marble, Granite, and tiles – Ceramic tiles of all kinds – Fans, pumps, compressors – Lamp and light fitting – Door, windows, and frames of aluminium. – Plaster articles such as board, sheet – Articles of cement or concrete or stone and artificial stone – Articles of asphalt or slate – Articles of mica – Floors made of ceramic, pipes, conduit, pipe fitting Wallpaper and wall covering – The glass of all kinds and articles thereof such as a mirror, safety glass, sheets, glassware
2	Furniture and Home Decorators which includes the following:   – Furniture, mattress, bedding and similar furnishing – Miscellaneous articles such as vacuum flasks, lighters – Trunk, suitcase, vanity cases, briefcases, travel bags and other handbags, cases – cutlery, stoves, cookers and similar non-electric domestic appliances – All musical instruments and their parts – Artificial flowers, foliage, and artificial fruits – Office or desk equipment – Fire extinguishers and fire extinguishing charge – exercise equipment, festival, and carnival equipment, swings, shooting galleries, roundabouts, gymnastic and athletic equipment
3	Personal Care which includes the following:   – Detergents, washing and cleaning preparations – Liquid or cream for washing the skin – Cosmetic items such as Shampoos, Hair Cream, Hair dyes (natural, herbal or synthetic) and similar other goods; henna powder or paste, not mixed with any other ingredient; – Shaving or after-shave preparations, personal deodorants, bath preparations, perfumery, cosmetic or toilet preparations, room deodorizers – Perfumes and toilet waters – Beauty or make-up preparations – Razor and razor blades
4	Electronic and office stationeries:   – Primary cell and primary batteries – Multi-functional printers, cartridges – Electrical, electronic weighing machinery – Electrical gadgets for radio and television broadcasting – Sound recording or reproducing apparatus – Signalling, safety or traffic control equipment for transports – Goggles, binoculars, telescope – Cinematographic cameras and projectors, the image projector – Microscope, specified laboratory equipment, specified scientific equipment such as for meteorology, hydrology, oceanography, geology
5	Clothing and Personal items:   – Wristwatches, clocks, watch movement, watch cases, straps, parts – The article of apparel & clothing accessories of leather, guts, furskin, artificial fur and other articles such as saddlery and harness for any animal
6	Equipment, Firework and Industrial Items:   – Forklifts, lifting and handling equipment – Bulldozers, excavators, loaders, road rollers – Earthmoving and leveling machinery – Escalators, Cooling towers, pressure vessels, reactors – Crankshaft for a sewing machine, tailor’s dummies, bearing housings, gears, and gearing; ball or roller screws; gaskets – Explosive, anti-knocking preparation, fireworks – Rubber tubes and miscellaneous articles of rubber – Solvent, thinners, hydraulic fluids, anti-freezing preparation
7	Food and Food preparations:   – Cocoa butter, fat, oil powder, – concentrates of coffee, miscellaneous food preparations – Chocolates, Chewing gum/bubble gum – food preparations of flour, groats, meal, starch or malt extract – Waffles and wafers coated with chocolate or containing chocolate

2. GST Rate reduction from 28% to 12% as per the list below:

• Wet grinders consisting of stone as a grinder
• Tanks and other armored fighting vehicles

3. GST Rate reduction from 18% to 12% as per the list below:

• Condensed milk
• Refined sugar and sugar cubes
• Pasta
• Curry paste, mayonnaise, and salad dressings, mixed condiments and mixed seasoning
• Diabetic food
• Medicinal grade oxygen
• Printing ink
• Handbags and shopping bags of jute and cotton
• Hats (knitted or crocheted)
• Specified agricultural, horticultural, forestry, harvesting or threshing machinery
• Specified parts of the sewing machine
• Spectacles frames
• Furniture wholly made of bamboo or cane

4. GST rate reduction from 18% to 5% as per the list below:

• Puffed rice chikki, peanut chikki, sesame chikki, Verdi, tired, khaza, lazuli, groundnut sweets gotta, Yuliya
• Flour of potatoes put up in a unit container bearing a brand name
• Chutney powder
• Fly ash
• Sulfur recovered in the refining of crude
• Fly ash aggregate with 90% or more fly ash content

5. GST Rate reduced from 12% to 5% as per the list below:

• Desiccated coconut
• Narrow woven fabric including cotton newer [with no refund of unutilized input tax credit] iii. Idli, dosa batter
• Finished leather, chamois and composition leather
• Coir cordage and ropes, jute twine, coir products
• Fishing net and fishing hooks
• Worn clothing
• Fly ash brick

6. GST rate reduction from 5% to 0% as per the list below:

• Guar meal
• Hop cone (other than grounded, powdered or in pellet form)
• Certain dried vegetables such as sweet potatoes, maniac
• Unworked coconut shell
• Fish frozen or dried (not put up in a unit container bearing a brand name)
• Khandsari sugar

GST Registration for Service Providers through E-commerce

1. As per the decision was given by 22^nd GST Council, it was decided to exempt those service providers whose aggregate turnover is less than Rs. 20 lakhs (Rs.10 lakhs in special category states except for Jammu &Kashmir) from obtaining GST registration even if they are dealing in interstate taxable services. However, the 23^rd GST Council meeting held has decided that E-commerce service provider will be exempt from obtaining GST registration if their aggregate turnover does not exceed Rs.20 lakhs
2. Export of service to Nepal and Bhutan are already exempted from GST. As per this decision of 23^rd GST Council, such exporters will be eligible to claim the input tax credit in respect of goods or services used for effecting such exempted goods or services.
3. Reduction of GST Rate for the following services:

S.No.	Services
1	Restaurants:1)    All standalone restaurants whether air-conditioned or not will now attract 5% without ITC. Also, restaurants in hotel premises who are having room tariff of less than Rs.7500 per unit per day will also attract GST @ 5% without ITC   2)    Food parcels or takeaways will also attract GST @ 5% without ITC. This will enable free home delivery facility and eating at restaurants will become cheaper
2	High-End Hotel Restaurants:1)   Restaurants having room tariff rate Rs.7500 and above per day will attract GST rate @ 18%
3	Outdoor Catering:GST Rate @ 18% with full ITC
4	Job Work:GST Rate on job work services to manufacturing handicraft goods in respect of a casual taxable person is exempted from obtaining registration, to be reduced to 5% with full ITC
5	a) Tickets to protected monuments: Exempted under GST)b) Transfer of Intellectual Property (i) Software: GST Rate @ 18% (ii) other than software: GST @ 12%

Changes made under GST Composition Scheme

Another major change introduced in the GST Council Meeting was in reference to the Composition Scheme features. Following are the changes incorporated in the scheme:

• It is proposed to increase the threshold limit for eligibility to Rs.1.5 crore. This limit might further be extended to Rs.2 crore.
• There will be a uniform tax GST rate for all manufacturers and traders @ 1%, however, there was no mention of any change for the composition tax rate for restaurants.
• Taxpayers registered under the Composition scheme are allowed to supply services with a taxable value of up to Rs. 5 lakhs per annum
• Now, GSTR 4 for the July to September 2017 quarter will be due only on the 24th of December 2017.

GST Exemption for Goods

There are certain changes in IGST as follows:

• IGST is now applicable to the import of life-saving medicines supplied free of cost by overseas suppliers subject to DGHS certification.
• IGST is now not applicable to the import of goods excluding motor vehicles under the lease agreement only if IGST is paid on the lease amount.
• IGST will not be applicable on imports of specified goods by a sports person of outstanding eminence, subject to specified conditions
• GST will not be applicable to specified goods, such as scientific or technical instruments, software, prototype supplied to a publicly funded research institution or a university or IISc, or IlTs or NIT.
• Goods can now be imported on a temporary basis without GST by accredited press persons visiting India to cover certain events, broadcasting equipment’s, sports items, testing equipment, under ATA Carnet

Clarification on GST Rates

• It is now clarified that the credit of GST paid on aircraft engines, parts and accessories will now be available for discharging the GST liability on the interstate of supply of such aircraft engines, parts, and accessories in the form of interstate stock transfer between the distinct person as defined under section 25of the CGST Act^[1]
• A circular will be issued shortly which will clarify that processed products such as tea, processed coffee beans, powder or pulses, jaggery, processed spices, processed dry fruits, etc. will fall outside the definition of agriculture produce as given in notification No.11/2017-CT® and 12/2017-CT® and therefore exemption of GST is not available to their loading, packing and warehousing, etc.
• It has been clarified that any services provided to Central government, state government, or any union territory under any insurance scheme for which the total premium is paid by the Central Government, State Government or Union territory are exempt from GST (SI.No.40 of Notification No. 12/2017- Central Tax (Rule)

Also, Read

• 22nd GST Council Meeting