February 20, 2023

Uncovering Industry Updates of 48th GST Council Meeting

In a recent GST Council meeting held on December 18, 2020, a few important changes have been proposed to ease the compliance burden for small businesses and address the concerns of taxpayers regarding the late fee levied on delayed filing of returns. Let's take a closer look at the key highlights of this meeting and how they impact small and medium businesses in India.

1. Extension of Due Dates for Filing GST Returns

The GST Council has decided to extend the due dates for filing various GST returns for the tax period of November 2020. The deadline for filing GSTR-4 (quarterly return for taxpayers under the composition scheme) has been extended till January 31, 2021, while the due dates for furnishing GSTR-9 (annual return) and GSTR-9C (reconciliation statement) have been extended till February 28, 2021. This move will provide some relief to small businesses who were struggling with compliance due to the ongoing pandemic and other operational challenges.

2. Late Fee Waiver for GSTR-4

In a major relief to small taxpayers under the composition scheme, the GST Council has decided to waive off the late fee for delayed filing of GSTR-4 for the tax periods between July 2017 to September 2020, provided that the returns are filed before January 31, 2021. This decision is expected to benefit more than 8 lakh taxpayers who are registered under the composition scheme and will help them in avoiding unnecessary financial burden due to the late fee.

3. Rationalization of Late Fee for GSTR-3B

The GST Council has also rationalized the late fee structure for GSTR-3B, which is a monthly return filed by regular taxpayers. The late fee has been reduced to a maximum of Rs. 500 per return for taxpayers having nil tax liability, while for others, the late fee has been capped at Rs. 1,000 per return. This change will help in reducing the compliance burden for taxpayers, especially small businesses, who were earlier facing exorbitant late fee charges for delayed filing of returns.

4. Introduction of E-invoicing for B2B Transactions

The GST Council has also announced that e-invoicing will be mandatory for all businesses having an annual turnover of over Rs. 100 crore from January 1, 2021. E-invoicing is an automated process of generating and transmitting invoices directly from the supplier's billing software to the recipient's billing software, which will help in curbing tax evasion and improving compliance. This move is expected to benefit the entire ecosystem of businesses, including small and medium enterprises, by reducing the time and effort required for generating invoices and ensuring seamless integration with the GST portal.

5. GST Rates for Covid-19 Related Supplies

Finally, the GST Council has recommended that the GST rates on certain Covid-19 related supplies such as medical equipment, PPE kits, and vaccines should be reduced to 5%. This decision will help in reducing the cost of these essential items and making them more affordable for the general public. The reduced GST rates will also benefit hospitals, diagnostic centers, and other healthcare providers who are currently facing financial stress due to the pandemic.


The recent GST Council meeting has brought some significant relief to small businesses and startups, who were grappling with compliance challenges and financial stress due to the pandemic. The extension of due dates, waiver of late fees, and rationalization of late fee structure will help in reducing the compliance burden for taxpayers, while the introduction of e-invoicing will improve efficiency and transparency in the billing process. The reduction in GST rates for Covid-19 related supplies will also provide some relief to healthcare providers and the general public. Overall, these decisions reflect the government's commitment to supporting small businesses and startups in India.


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