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Tax threshold among key GST meet agenda

Rate cut for under construction properties, composition scheme for small service providers on cards
Some of the key issues likely to be discussed during the 32nd GST Council meeting on Thursday include increasing the Rs. 20-lakh threshold for GST eligibility, reducing tax rate on under-construction properties in a bid to boost the real estate sector, extension of the composition scheme to service providers, and approval of a possible disaster relief cess for Kerala, according to tax analysts following the matter. The council, in its last meeting on December 22, had decided to form several committees to look into these issues. Union Finance Minister Arun Jaitley had said at that time that the recommendations of these committees would be taken up in the subsequent meeting. Currently, the Composition Scheme allows small manufacturers and traders, with an annual turnover of less than Rs. 1 crore, to file quarterly returns and pay GST at nominal rates. These traders, however, cannot avail input tax credits or deal in items exempt from GST. Tax analysts believe that the Composition Scheme for small service providers is likely to be decided upon in Thursday’s meeting, along with a possible change in the return filing timelines for companies under the scheme. “What we are expecting is that they will come up with a Composition Scheme for small service providers,” Archit Gupta, founder and CEO of ClearTax told The Hindu . “They had set up a committee for that. That will be something different because so far service providers cannot opt for composition. That seems very likely to happen.”

Annual returns filing

“What will be interesting is that (Bihar Deputy CM) Sushil Modi had recommended an annual returns filing for the Composition Scheme filers,” Mr. Gupta added. “That could be taken up as well.” Mr. Modi is also the head of an inter-ministerial committee set up to look into the IT issues to do with GST. The Council is also likely to deliberate upon raising the Rs. 20 lakh annual turnover threshold above which companies have to register in the GST system. Another issue likely to be discussed is the imposition of a cess to finance the disaster relief efforts in Kerala following the floods there.

“On the increase in the threshold limit, while it should bring quite a relief to the small players, the government should coherently evaluate the impact on revenue collections,” Abhishek Jain, Tax Partner, EY said. “While the levy of disaster cess should help in the hardships caused due to the Kerala floods, the government should in detail analyse the levy mechanism so that it is easy to implement by businesses.”

Source : https://www.thehindu.com/todays-paper/tp-business/tax-threshold-among-key-gst-meet-agenda/article25954728.ece

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