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As planned Highlight of 29th GST Council Meeting conducted on 4th of August 2018 in New Delhi. As expected there was a discussion relating to issues and concerns faced by Micro, Small and Medium-sized Enterprises after implementation of GST. Along with these issues initiatives relating to encouragement of digital payment of GST liability are also introduced. In this blog, we will discuss in brief the major Highlight of 29th GST Council Meeting.
Table of Contents
In past meetings, some major GST rate cuts were proposed and implemented. In the 28th GST Council Meeting along with actual rate cuts, many recommendations were also made to move various items from 18%, 12% or 5% to 0%.
In the 29th GST council Meeting, no such recommendations for rate cuts were made. There was an expectation that some rate cuts might be recommended but due fall in expected revenue in the quarter of April-June of 2018 no rate cuts were announced. This highly expected relief has been put on hold due to this unexpected fall in revenue.
As observed there has been a lot of notification issued and recommendations made by GST Council which are focused on MSME Sector. This is done to ensure all the necessary support to the startups in India. Before conducting this meeting industry experts and trade & industry associations were encouraged to forward their concerns and grievances related to MSME Sector. As a result, a lot of responses were received by the department.
In a developing country like India, MSME sector provides great support, from providing numerous employment opportunities to contributing to more than 25% of the country’s GDP. Keeping in mind the significance of the MSME sector a subcommittee of ministers is been set up with a view to resolving taxpayer’s grievances as well as the proposals made by the industry experts. Mr Shiv PratapShukla the respected Minister of Finance will be chairing this sub-committee. It will work in coordination with the fitment committee and law committee under the ambience of GST laws to simplify the GST Return Filing and compliance requirements for the MSME sector. This step is expected to provide relief to taxpayers whose annual turnover will not exceed 1.5 Crore rupees.
In this digital era and the rapid increase in the number of mobile phone users, there is a rise in the trend of making digital payments. Currently, payment of GST liability can be done through internet banking. In the previous meeting, Shri Sushil Kumar Modi committee proposed digital payments to make it more user-friendly. After pondering on the same, the GST Council has decided not only to facilitate digital payments on GST registration portal but also to introduce the cashback scheme on making digital payments.
The main object behind the introduction of this cashback scheme is to encourage adherence to tax payment compliances in India.
It is proposed that for every payment made for the B2C transaction through a digital mode 20% of the GST will be refunded to the client through cashback.
However, the maximum amount of cashback is set at Rs. 100.
Digital payments made through following modes are covered under the scheme;
No, this scheme is not mandatory in nature. The states are given discretion for its implementation. Any state willing to enforce this scheme can develop the required software and implement it on a pilot basis. Currently, states of Maharashtra, Assam, Bihar, and Tamil Nadu have expressed their willingness to implement the scheme
Read our article:Expectations from 29th GST Council Meeting
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