NEWS – 53rd GST Council Meeting held in New Delhi

HIGHLIGHTS

Agenda Items: Included discussions on easing compliance burdens for taxpayers, revision of due dates, rate rationalization, and GST-related reforms.

Pre-Budget Consultation: Union FM held pre-budget consultations with states and UTs before the meeting

Ease of Compliance Burden:

• Changes in GSTR-1 reporting and amendment allowed within the same tax period.
• Threshold for reporting B2C interstate supplies reduced from Rs.2.5 lakh to Rs.1 lakh.
• Extension provided for GSTR-4 filing due date to 30th June 2024.
• Recommended reduction in TCS rate for ECOs from 1% to 0.5%.

Other Compliance Measures:

• Mandatory filing of GSTR-7, even if no TDS deducted.
• Exemption from filing GSTR-9/9A for taxpayers with turnover up to Rs.2 crore for FY 2023-24.
• Modifications and relaxations in ITC availment and late filing provisions.

Legal and Procedural Amendments:

• Monetary limits set for GST appeals at various levels.
• Sunset clause for anti-profiteering cases and shift of hearing panel.
• Extension of time limit for filing appeals before GSTAT.

Rate Rationalization:

• Amendment recommended for not levying GST on Extra Neutral Alcohol used in manufacturing alcoholic beverages.
• Uniform GST rate of 12% recommended for certain items like milk cans, carton boxes, sprinklers, solar cookers, etc.
• Exemption and relief measures for services provided by Indian Railways, hostel accommodation, etc.

Ongoing Analyses and Discussions:

• Not addressed in this meeting: GST on fertilizers, horse racing, online gaming, and fuel rates.
• Establishment of a GoM to analyze GST on fertilizers.

Other Updates:

• Corporate guarantee exempt from GST if whole ITC is available for goods or services

GST COUNCIL

Constitution of GST Council:

• Article 279A of the amended Constitution mandates the formation of the GST Council within 60 days of Article 279A’s commencement.
• The Council is a joint forum comprising members from the Centre and States, including the Union Finance Minister as Chairperson, Union Minister of State (in-charge of Revenue or finance) as a member, and Ministers nominated by each State Government as members.

Functions of GST Council:

The Council makes recommendations to the Union and States on critical GST-related matters, such as goods and services subject to/exempted from GST, model GST Laws, Place of Supply rules, threshold limits, GST rates including floor rates and bands, special rates during calamities, provisions for certain States, etc.

Formation Approval:

• The Union Cabinet under Prime Minister Narendra Modi approved the establishment of the GST Council on 12th September 2016.
• The Cabinet also approved the creation of the GST Council Secretariat in New Delhi, with the Secretary (Revenue) as the Ex-officio Secretary to the Council.
• Additionally, the Chairperson of the Central Board of Excise and Customs (CBEC) is a permanent invitee (non-voting) to Council proceedings.
• The Cabinet allocated funds for the GST Council Secretariat’s expenses, including staffing with officers from Central and State Governments.