On the 28th and 29th of June 2022, the 47th GST council meeting was held in Chandigarh. GST council is a constitutional body set up under Article 279A of the constitution of India. Its main objective is to provide recommendations to the union and state about the matters in GST. To meet its objectives, the GST council holds periodical meetings where representatives of both union and state meet to make decisions.
The GST council meeting held this year made many such amendments and adjustments. Let us understand these decisions in detail.
Finance minister Nirmala sitaraman began to brief the media around 4p.m and she began the meeting by appreciating the Chandigarh organizers for their help in organizing the 2-day event smoothly. Some of the key highlights of the meeting included:-
1. Interim report on rate rationalization, exemptions, and correction of inversion nature
2. Betting, gambling, and horse racing
3. IT related matters
4. Movement of precious items such as gold, etc.
The GST council allowed amendments to GSTR-3B (Monthly return for taxpayers). It also permitted auto-completion of most details in form GSTR-3B and annual returns in form GSTR-9 for better compliance and ease of compliance. The council was clear that the new GST system would be withdrawn as it is no longer relevant. A proposal for a more comprehensive alteration in GSTR-3B will be placed before the public seeking input.
Annual returns for FY-2021-22 may be notified with some changes:-
1. It shall continue to apply with some relaxations and modifications
2. GSTR-9 and GSTR-9A will not apply to those with an applicable threshold below 2 crores for FY-21-22
3. The limitation under section 73 of the CGST Act for FY 2017-18 for issuance of orders relating to demands linked with the due date of annual return, is extended till 30th September 2023.
GST council agreed to ease compliance for e-commerce suppliers
1. It allowed e-commerce operators to register under the composition scheme for intrastate supplies easing their registration hassles and for reducing tax outgo
2. The new composition scheme for e-commerce suppliers for intrastate online sales will be implemented on 1st Jan 2023 once the IT system is set up
3. Intrastate e-commerce operators will no longer have to obtain mandatory registration if their turnover does not exceed 40 lakhs (goods) or 20 lakh (services) or such limit as specified in respective states/UTs
4. Intrastate suppliers on e-commerce platforms shall have to obtain registration irrespective of their respective turnover.
1. GSTR-4 for FY 2021-22 to get a waiver of late fee for filing up to 28th July 2022 as against an earlier extension of up to 30th June 2022.
2. CMP-08 deadline for Apr-Jun 2022 (Q1 of FY 2022-23) to get an extension up to 30th July 2022 from 18th July 2022.
The GST Council accepted the interim report of GoM on rate rationalization in totality and most of the recommendations by the Fitment Committee.
These are some of the major decisions taken by the GST council at their 47th GST council meeting. Let us understand some other decisions
1. Clarifications regarding allowing money in electronic credit ledger and electronic cash ledger to be used to pay output tax dues in return. Such amount cannot be used to pay off dues, penalties, late fees, and interest
2. The GST council to form a group of ministers to consider setting up a GST appellate tribunal after a detailed study of its structure
3. GST Council approves waiver from the filing of refund claims by condoning the two-year COVID period from 1st March 2020 to 28th February 2022. Council decides to permit tax authorities to file appeals against erroneous refunds by not considering the two years.
4. Ease in refund claims for the export of electricity and select concessional goods with an inverted tax structure.
5. GST Network may set up AI/ML-based systems to cross-check the antecedents of the GST registration applicants and improve risk-based monitoring of their behavior post-registration so that non-compliant taxpayers can be identified at the nascent stage and actions be taken to minimize revenue losses.
6. A decision was taken to defer the implementation of the GST margin scheme for tour operators after studying it in detail.
Old GST rates
New GST rates
Knives with cutting blades/paper knives/pencil sharpeners and blades/spoons/forks/ladles/skimmers/ cake servers, etc.
Power-driven pumps like centrifugal pumps/submersible pumps/deep tube well-turbine pumps/bicycle pumps
Machines for sorting, cleaning or grading seeds/pulses or grains
Machines used in the milling industry
Machines used for working on cereals, etc. Pawan chakki, wet grinder
Drawing and marking out instruments
Machines for sorting, cleaning ,or grading fruits/eggs/ other agricultural produce
Milking and dairy agriculture
LED lamps, lights ,and fixtures and their metal printed circuits board
Solar water heater and system
Prepared or finished leather/composition leather/chamois leather
It is a destination-based tax on the consumption of goods and services. It is proposed to be levied at all stages right from manufacture up to final consumption with credit of taxes paid at previous stages available as setoff.
The tax would accrue to the taxing authority which has jurisdiction over the place of consumption which is also termed as place of supply
The existing taxation system (VAT & Central Excise) will continue in respect of the above commodities.