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Post GST reduction GCPL passes on the benefits to consumers

Post GST reduction GCPL passes on the benefits to consumers

Post GST reduction GCPL passes on the benefits to consumers

Post GST reduction GCPL passes on the benefits to consumers

On Tuesday, ITC, Dabur, HUL and Marico, had cut prices of various products following the reduction in GST rates effective November 15.

“We are committed to passing on the benefits of the reduced rates to our consumers and have initiated a 7-10 per cent price reduction in our products across hair colours, air fresheners, liquid detergents and deodorant categories,” Business Head-India and SAARC, Godrej Consumer Products Ltd (GCPL), Sunil Kataria was quoted by PTI as saying.

The move comes days after the Government asked the firms to immediately revise the MRP on the products to pass on lower GST rates to consumers.

GCPL said the reductions will be effective immediately and would also be applicable to our existing stocks.

“We are working very closely with our distributors and channel partners to monitor that the reduced MRPs are being passed on to the consumers,” Kataria told PTI.

He was further quoted by PTI as saying: “Our intent is to offer maximum support to retailers and wholesalers so that the switch to the new pricing is seamless and quick”.

The Goods and Services Tax (GST) rate was reduced on 178 items, including detergents, shampoos and beauty products, from 28 per cent to 18 per cent from November 15.

GST rates on a number of items have also been reduced from 18 per cent to 12 per cent and from 12 per cent to 5 per cent.


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Source: India Retailing
15th Finance Commission to assess GST impact on tax revenues, allocate more resources to states, says Arun Jaitley

15th Finance Commission to assess GST impact on tax revenues, allocate more resources to states, says Arun Jaitley

Arun Jaitley : GST

The Cabinet on Wednesday approved the setting up of the 15th Finance Commission which will assess the tax resources of the nation and suggest a formula for their devolution among states.

The members of the Commission and its terms of reference will be notified in the due course of time, Finance Minister Arun Jaitley said after the Union Cabinet meeting. Its recommendations will have to be in place before April 1, 2020, he said.

“Normally, it takes 2 years for Finance Commission to give its recommendations.”

As per Article 280 of the Constitution, the Commission is required to make recommendations on the distribution of the net proceeds of taxes between the Centre and the states.

The Commission also suggests the principles which should govern the grants in aid of the revenues of the states out of the Consolidated Fund of India. This time it will have to take into account the impact of the Goods and Services Tax, which kicked in from July, on the resources of the central as well state governments.

On who will head the 15th Finance Commission, Jaitley said: “The members of Finance Commission will be appointed very very soon.”

When asked whether the 15th Commission will also allocate more resources to the states, he said: “I think let us not prejudge the situation. India is a Union of states, the Union also has to survive.”

The 14th Finance Commission was set up on January 2, 2013. Its recommendations cover the period from 1 April, 2015 to 31 March, 2020.


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Source :  Firstpost
GST and real estate: Govt needs to address grey areas, disputes and litigations; take feedback from realtors, say experts

GST and real estate: Govt needs to address grey areas, disputes and litigations; take feedback from realtors, say experts

GST and real estate

Much has been discussed, argued and debated on demonetisation and the Goods and Services Tax (GST) implementation at various forums including election campaigns. Opposition parties slammed both the moves of Prime Minister Narendra Modi, though the latter managed to hit headlines on Thursday again after the Pew Research Centre’s survey announced him as ‘very popular’.

Without taking names or giving political colour, a panel discussion on ‘Dialogue on demonetisation, GST and the built environment industry’ organised jointly by RICS School of Built Environment, Amity University and National Institute of Urban Affairs (NIUA) on Thursday evening (16 November) in New Delhi, attempted a threadbare analysis of the impact of demonetisation and GST on the real estate sector.

In his inaugural presentation, noted economist Arun Kumar, Malcom S Adiseshiah, Chair professor, Institute of Social Sciences pointed out that the present form of GST was not ‘full GST’ as it kept real estate, alcohol, electricity and petroleum out of its ambit. “Now, if tax to GDP ratio rises, it’ll give rise to inflation. As a result, demand will fall and the rate of growth (will) decrease, which is contrary to what GST promised. The small and unorganised sector has been ignored and this sector can’t deal with GST due to its complexities. While demonetisation has put the economy on the downslide, the GST implementation has aggravated the condition. The poor have been marginalised in the process. Demonetisation and GST are the two big shocks,” he remarked.

On the possible impact of demonetisation on large real estate projects, Prof Kumar said demonetisation had resulted in decline of growth rate and GDP, and rise in deficit. “As the government won’t like fiscal deficit to go up, the demand in the sector will go down.”

Responding on a positive note, Arun Gupta, partner, SARC Associates said, “Demonetisation to some extent has led to an increase in tax compliance at present.” However, he mentioned, “GST in theory is a good system, but the way it was promised and projected during implementation, the government lost its way. There is a big lag between the plan and the outcome.”

Is demonetisation just a blip or has it had a much deeper impact on the economy? In response, Prashant Agarwal, partner (Indirect Taxes) at Pricewaterhouse Coopers said, “It was a shock therapy. Even after one year, we fail to know the significance of demonetisation or even implementation of GST. If we talk about these two actions or reforms, while PM Modi gained a Robin Hood image, the economists including former PM Manmohan Singh mentioned it as ‘shocking impact’. ”

Jagan Shah, director, NIUA observed, “Lack of implementation of policy interventions has impacted the sector. I don’t believe it’s a blip per se; but it’s a sign for a paradigm shift.”

Arun Kumar said that theoretically demonetisation won’t tackle black economy. “Demonetisation has hit investment and output. Credit off-take has declined. These are long-term effects. Investment can revive, once capacity utilisation picks up. Both public and private sectors have to boost investment, but it’s a Catch 22 situation.”

Gaurav Gupta, director, SG Estates Limited observed that after two decades people might not remember demonetisation, but it temporarily sucked up cash from the system. The move came as a shock and its biggest impact was on the unorganised sector. Probably, demonetisation wasn’t required, especially when government was implementing the GST.

Summing up the first round, panel moderator and associate dean and director, RICS School of Built Environment, Amity University, Sunil Agarwal said, “It’s not a blip as in the long-term people would remember the impact of demonetisation.”

GST- PANEL-DEMO

Has GST adversely impacted the real estate sector? Panellists unanmously opined that while the intention of GST was good, its implementation and rates led to more confusion. They suggested that the government needed to address the grey areas,  disputes and litigations bothering the real estate sector by taking feedback from the realtors.

The government wanted the entire real estate sector under GST, but it’s half-done, which has been due to the states, said Prashant Agrawal, adding, “There’s an issue of distrust between the Centre and the states as far as revenue sharing is concerned. There are lot of legal issues in real estate sector. The players of this sector need to have a clear perspective and discuss their problems with the government on taxation. However, realising the problem, the government has brought down GST rates.”

In response, Gaurav Gupta said, “Real estate sector’s contribution to GDP is 9 percent and it is the second largest employment generator. The government has brought in lots of regulations, but there is an urgent need to improve the investment climate in this sector. Practical problems need to be resolved.”

Explaining the issue, Arun Kumar said, “There’s a need to simplify the process and bring real estate, liquor and petro fully under GST. This will help the sector. But there’s pressure from the states to keep them out and the Centre couldn’t handle it.”

While, the panellists delved into the pros and cons of note ban and GST, there were voices from amongst the audience who questioned the credibility of real estate players. Many shared the view that the decline in growth in the real estate sector started in 2012 — much before demonetisation and GST implementation —because of low credibility.

“Implementation of GST hasn’t contributed much to the slowdown in the real estate sector. Before GST, there was service tax. In fact, barring a few developers, the credibility of a majority has been questionable. They defaulted on the promises they made to their customers. Even banks refused extending credits. Despite taking money from home-buyers, the builders failed to deliver flats. It badly impacted the sector. The need of the hour is to regain confidence of the government, customers and financial institutions,” remarked Captain Vipul Choudhary, a retired army official and director, Olive Green Realty — a real estate consultancy firm.

Former HUDCO CMD, PS Rana questioned why land had been made unaffordable for the masses. “In any project, land cost is the real culprit. For example, a developer buys land at Rs 1 crore from a farmer, but by the time he begins construction, the price shoots up to Rs 10 crore. This makes entire project costlier.”

Moderator Sunil Agarwal said, “The demand in real estate sector is there but it’s in segments. Now, a lot of corporate houses have entered, making the sector more organised. It’s giving credibility to the sector as well.”


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Source :  First Post
Buying groceries? Make sure to check GST ‘discounts’

Buying groceries? Make sure to check GST ‘discounts’

From Wednesday, consumers would do well to check their shopping bills closely. A host of packaged products such as chocolates, toothpastes, shampoos and shaving creams – with the maximum retail price printed on them – is set to become cheaper following a steep reduction in the goods and services tax.

Some companies manufacturing these products have asked traders to pass on the tax cuts to consumers immediately, without waiting to put revised maximum retail price stickers on them or printing new packs, both of which would take time.

A watch company and a printer maker plan to inform customers about the price reduction through newspaper advertisements. Still, consumers should be aware that not all companies may implement the price cuts right away.

The changes will affect a large number of products that are already in stores or on their way there. Pasting stickers with revised prices can be done only after the government gives the go ahead. Apart from taking time, some companies said pasting stickers costs the same as printing packs with the revised prices.

revised gst

The maximum retail price of a product includes taxes and unless a company increases the base price or raises the margin for distributors and dealers, these products should become cheaper. The government is yet to issue fresh guidelines on pasting stickers with the revised prices.

“A number of products are in the MRP category, so companies will have to put a sticker or print new prices,” a government official said. The GST Council reduced the tax rate on about 200 products, of which 178 were moved to 18 per cent from the 28 per cent slab, at its 23rd meeting on November 10. The new rates are effective from midnight Tuesday, with both the states and the Centre issuing notifications.

“It’s good that the GST Council decided to bring in the changes from a particular date, that is November 15, as in a few cases earlier, different states had issued notifications from different dates,” said Pratik Jain, indirect tax partner, PwC.

“However, given the paucity of time, most companies have not been able to reduce the MRP of products but have communicated to dealers and retailers that prices should be brought down.” Consumers need to be aware about what prices are likely to come down and by how much, irrespective of the MRP printed on the product, he said. Gujarat Cooperative Milk Marketing Federation, which makes Amul, the country’s largest dairy brand, has told distributors to sell its products at the revised prices, managing director RS Sodhi said.

“We have started the process of price revision. But there will be some transition time before which products with new MRPs reach end consumers,” he said. GST slabs on condensed milk and chocolate have been revised downwards, directly impacting the company’s products. Dabur, the maker of Real fruit juices and herbal and ayurvedic products, said it has not informed its trade channels about the revised prices.

“So far we have not communicated anything to our distributors as we are awaiting the notification,” Dabur chief financial officer Lalit Malik said. “We are in the process of evaluating the impact of this announcement and a final decision will be taken post the notification of the rate cut.” Some companies may not cut prices and instead increase pack sizes.

“When the tax slabs went up in July, we did not increase prices. Now that they have been revised downwards, we may not drop prices. We will wait and see how the market dynamics play out before taking a decision,” said the head of a large cosmetics company. Consumers should keep a tab on restaurant bills, too.


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Source :  The Economic Times
GST Revised Rates: Eating out in hotels, restaurants to become cheaper from today

GST Revised Rates: Eating out in hotels, restaurants to become cheaper from today

GST rates slashed: Eating out in hotels, restaurants to become cheaper from today

Eating out in hotels and restaurants will become cheaper from today (15 November) with the Goods and Service Tax (GST) Council having slashed rates to five percent from 12 and 18 percent earlier. However, there is no formal notification from the government as yet.

A uniform 5 percent tax was prescribed by the council for all restaurants, both air-conditioned and non-AC. Union Finance Minister Arun Jaitley said that the Input Tax Credit (ITC) benefit given to restaurants was meant to be passed on to the customers.

Currently, 12 percent GST on food bill is levied in non-AC restaurants and 18 percent in air-conditioned ones. All these got input tax credit, a facility to set off tax paid on inputs with final tax. The council said the restaurants, however, did not pass on the input tax credit (ITC) to customers and so the ITC facility is being withdrawn and a uniform 5 percent tax is levied on all restaurants without the distinction of AC or non-AC.

Restaurants in starred-hotels that charge Rs 7,500 or more per day room tariff will be levied 18 percent GST but ITC is allowed for them. Those restaurants in hotels charging less than Rs 7,500 room tariff will charge 5 percent GST but will not get ITC.

Also, tax on wet grinders and armoured vehicles was cut from 28 percent to 12 percent, Jaitley said, adding the tax rate on six items was reduced from 18 percent to 5 percent, on 8 items from 12 percent to 5 percent and on six items from 5 percent to nil.

Chewing gum, chocolates, coffee, custard powder, marble and granite, dental hygiene products, polishes and creams, sanitary ware, leather clothing, artificial fur, wigs, cookers, stoves, after-shave, deodorant, detergent and washing power, razors and blades, cutlery, storage water heater, batteries, goggles, wrist watches and mattress are among the products on which tax rate has been cut from 28 percent to 18 percent.

“This revision in GST rate for restaurants is positive, as it would bring down the dining-out cost, supporting footfalls and revenues at a time when most organised restaurants are struggling to grow demand,” ICRA Vice President and Sector Head Pavethra Ponniah said.

“As most major inputs for restaurants like grains (not packaged), vegetables, poultry and seafood are exempt from GST, the input credit advantage available for restaurants was negligible,” Ponniah said, adding that restaurants were also not passing on any benefit of input tax credit to the consumer under GST.


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Source :  Firstpost
With simplified tax rates, revenue loss of Rs. 20,000 crore can be compensated

With simplified tax rates, revenue loss of Rs. 20,000 crore can be compensated

With simplified tax rates, revenue loss of Rs. 20,000 crore can be compensated

To what extent the GST Council’s move to ease the tax burden on consumers will pressure the fisc remains to be seen. Nevertheless, given how onerous the GST framework was turning out to be, it was imperative the returns filing schedule be made more lenient and tax rates be lowered. To that extent, finance minister Arun Jaitley, his team and the state finance ministers need to be congratulated for having responded to the grievances of taxpayers even if it means giving up some revenues. At this point, it is important the system does not intimidate assessees since the number of returns filed has been lower than expected, but it is picking up—as compared to the 6.5 million who were to file their summary returns for August, just 4.7 million have filed so far, but that number will increase over time. The increase in the ceiling for the composition scheme to Rs 1.5 crore, for instance, will make life easier for thousands of small businesses. Moreover, for close to 40% of the taxpayers whose tax liability is nil, filling out the form will be really elementary now.

Also Read: Finance minister Arun Jaitley hints at further trimming of GST 

And for the rest, too, the schedule is considerably easier—for assessees with a turnover of less than Rs 1.5 crore, the GSTRN1 for sales details needs to be filed just once a quarter and not every month. However, taxpayers with an annual turnover of more than Rs 1.5 crore need to file every month. While the sharp cut in tax rates across the board—only 50 items are left in the top 28% slab—might seem populist, it would nonetheless be disinflationary and spur consumption spending. More important, lower rates should encourage compliance and over time broaden the tax base. The cuts in the tax rates will give smaller firms—ancillaries or vendors—an edge over unorganised players since the pricing differential would now be lower; this should encourage formalisation.


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To be sure, some measures taken by the GST Council, such as not allowing restaurants to avail of input tax credit, are seen to be distorting the format of the GST and also smack of the anti-profiteering law—in this case, the government decided restaurants were not lowering prices in keeping with the lower tax rates and so input tax credit was to be denied. On the plus side, the move has been accompanied by a lowering of the rate to 5% and it has been made uniform for all restaurants except those in 5-star hotels. The government estimates the loss to the exchequer, on account of the cut in the tax rates, at roughly Rs 20,000 crore or 0.12% of GDP, and if the losses materialise, the fiscal deficit could slip to 3.5% compared with the targeted 3.2%.

However as the finance minister observed, the lower tax incidence and the more liberal rules for filing returns should result in better compliance and better collections. So far, the monthly GST collections have been rising from Rs 94,063 crore in August to Rs 95,131 crore in October, after a dip to Rs 93,141 in September; analysts at Credit Suisse observe these numbers are healthy given Q2 tends to be seasonally weaker. As of now, though the shortfall in collections by the states—compared to the monthly target of Rs 45,000 crore—has narrowed to 24% in September and further to 17.6% in October versus 28.5% in August. Once, the IGST revenues are allocated to states and the claims for transitional credit of around Rs 90,000 crore are sorted out, a clearer picture of the revenues will emerge. Given the system is now easier to deal with, it is likely revenues will pick up.


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Source :  Financial Express
Finance minister Arun Jaitley hints at further trimming of GST

Finance minister Arun Jaitley hints at further trimming of GST

Arun Jaitley : GST

Finance minister Arun Jaitley on Monday hinted at further rationalisation of goods and services tax (GST) rates, while slamming opponents who have been advocating a shift to a single-rate regime, in what was seen as a rebuff to Congress vice-president Rahul Gandhi.

“Rationalisation process in a transition (phase) will continue… Such rationalisation in future will depend on revenue buoyancy,” the finance minister said.

On Friday, the GST Council, led by Jaitley, slashed rates of over 200 items with the levy on 176 reduced from 28% to 18%, leaving just 50 in the highest slab. While state FMs have said this list will be pruned further, a change in lower slabs of 12% and 18% is also on the cards in the coming months.

Jaitley has repeatedly said over a period of time, these two rates will converge into one, something he reiterated on Monday but linked it to tax buoyancy.

Jaitley hopes GST rate cuts will reduce inflation

In what seemed to be a response to Rahul Gandhi’s claim+ that Congress will shift all products to a single bracket, Jaitley said: “Those who are speaking of a singlerate GST have no understanding of the tariff structure… they do not have elementary understanding of goods & service tax.”

With the rate cuts, the government is expecting the gains on a host of products — from cosmetics and razors to washing powder — to be passed on to consumers.

Jaitley said GST has brought down inflation. “This actually reduces inflation. This is one of the advantages of a more efficient tax system… Effectively, today, almost all items in the goods category are better off than they were prior to July 1,” he said.

The minister said that including central excise, state VAT and central sales tax, the levy on several items added up to 31%, which was reduced to 28% when GST was launched. Elaborating on it, he said the process of reduction in the top slab was under way since August. “This is a threefour month exercise… These are all consensus decisions of the GST Council and process started after GST implementation. It is juvenile politics+ to link it with either elections or political demands,” the minister said.

Also Read: GST Council prunes list of goods to be taxed at 28% to 50

He said the GST Council had opted for a structure where food items were exempted, while aam aadmi products were kept in the lowest bracket of 5%. “Wheat, rice or sugar can’t be taxed at the same rate as a Mercedes (car) or a yacht or tobacco. So, rates will have to be different.” In recent tweets and public meetings in Gujarat, Gandhi has talked about Congress reducing rates to under 18%, something that has been repeated by some of his party colleagues.

Jaitley said revamped filing mechanism that has been put in place, will ease the burden on taxpayers and going forward he wants the system to settle and apprehensions to disappear.


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Source :  The Times of India
Next step in GST recast: Lower end of tax slabs

Next step in GST recast: Lower end of tax slabs

Next step in GST

The next rejig of goods and services tax  (GST) will likely focus on the lower end of the rate slabs, as the country seeks to further streamline the structure by converging multiple rates into two or three. It will happen after the regime settles down and there is more clarity on revenue following the recast last week.

implification of laws, rules and procedures in line with industry’s feedback is also likely to top the GST Council’s agenda in the next few meetings.

The rates on some items such as cement and paint, still left at the highest rate of 28%, could be brought down if tax revenue remains robust.

A top official with a state government said the focus would now be to recast the lower 12% and 5% rate slabs.

Other issues to be considered by the council are inclusion of real estate and petroleum products under GST.

The government has set up a group with industry representation to review the tax regime, which has since its July 1 launch been criticised for having too many rates and being burdensome to comply with.

Also Read: Six Things You Must Know About the New GST Rates 

The latest recast, decided at a GST Council meeting in Guwahati last week, has seen the 18% rate emerging as the dominant slab with nearly half the goods, apart from most of the services, now taxed at that rate.

GST Councile meet towards better gst

The Guwahati meeting decided to move 178 items to the 18% rate from 28% and cut the GST on eating at restaurants to 5% from Monday, in a decision that would reduce tax revenue by Rs 20,000 crore.

It may have been possible to move some more goods to the 18% slab from 28%, but that would have resulted a bigger revenue loss. Officials said cement and paint alone would have cost the government more than Rs 20,000 crore had the two been moved a slab lower.

“We need revenue as well,” said the state government official.

But eventually, the 28% slab would be left with very few items, mostly in the luxury and sin-goods category.

Also Read: GST Council prunes list of goods to be taxed at 28% to 50

Other increasingly common-use items that are still in the 28% slab include air conditioners, refrigerators, washing machines, vacuum cleaners and digital cameras. In all, more than 50 items still remain on the 28% list.

A committee headed by chief economic adviser Arvind Subramanian had suggested a revenue-neutral rate of 15-15.5%, with a strong preference for the lower end of that range. It had recommended a standard rate — for services and most goods — of 17-18%, high or non-GST excise rate of 40% for items such as luxury goods and tobacco, and a low rate of 12% for essential goods.

With the latest recast, the rates have moved closer to this structure.

further recast of the 5% rate, moving some up to 12% and scrapping the tax on others will further simplify the GST structure.

Lesser rates will bring stability to the overall tax regime, said experts.

“GST needs to be a simple, transparent and stable tax system. Multiple rate slabs result in classification disputes as businesses attempt to classify their products in lower slabs,” said Pratik Jain, indirect taxes leader, PwC.

In most countries, including Australia, Malaysia and Singapore, there is one standard rate, or at best a lower rate in addition to a standard rate. “Single rate will remove complexity from the structure as also alleviate revenue concerns,” said Bipin Sapra, partner, EY.

CONGRESS RAISES PRESSURE 

Congress vice-president Rahul Gandhi in a tweet demanded that petroleum products and LPG cylinders be brought under GST.

He said the government should have a single rate that should not be more than 18%, and remove GST on products that the common man uses.

A day ahead of the council meeting in Guwahati, Congress-ruled states had demanded complete revamp of the GST structure.

Source :  The Economic Times

Six Things You Must Know About the New GST Rates

Six Things You Must Know About the New GST Rates

GST-council-meet1

Tax rates on over 200 items, including beauty products, chewing gums, chocolates, coffee, and custard powder, among others, were slashed from 28 per cent to 18 per cent, Finance Minister Arun Jaitley said after the 23rd GST Council meeting in Guwahati. The council also made changes to the composition scheme. The GST Council also decided that taxpayers with an annual aggregate turnover up to Rs. 1.5 crore need to file return using form GSTR-1 on a quarterly basis, while taxpayers with a turnover of above Rs. 1.5 crore need to file it on monthly basis.

Six things you must know about the new GST rates

1) The GST Council pruned the list of items in the top 28 per cent Goods and Services Tax (GST) slab to just 50 from current 228. So, only luxury and sins goods are now in the highest tax bracket and items of daily use are shifted to 18 per cent. Mr Jaitley said that the Council over the months has been pruning items in the 28 per cent list.

2) Eating out becomes cheaper: All restaurants will be levied the GST at 5 per cent, without input tax credit (ITC) benefits. However five-star restaurants within starred-hotels with room rent above Rs. 7,500 will attract 18 per cent and can still avail ITC benefits, the council said. Outdoor catering will attract 18 per cent GST with input tax credit benefits.

3) The top tax rate of 28 per cent will now be levied on goods like pan masala, aerated water and beverages, cigars and cigarettes, tobacco products, cement, paints, perfumes, ACs, dish washing machine, washing machine, refrigerators, vacuum cleaners, cars and two-wheelers, aircraft and yachts. “These revisions in rates are expected to reduce prices and increase consumption and thereby bring growth for the consumer products and retail industry,” EY India said in a statement.

4) GST on 13 items has been reduced to 12 per cent from 18 per cent.

5) GST on two items has been brought into 12 per cent GST slab from 28 per cent bracket. Six items have been brought into 5 per cent from 18 per cent slab. GST on eight items has been cut to 5 per cent from 18 per cent.

6) Tax rate on six items has been lowered to zero from 5 per cent. Tax on wet grinders and armoured vehicles was cut from 28 per cent to 12 per cent. Tax rate on six items was reduced from 18 per cent to 5 per cent, on 8 items from 12 per cent to 5 per cent and on six items from 5 per cent to nil. To get a full list of tax cuts click here.

Experts and industry welcome the reduction in tax rates 

Industry has welcomed the outcome of 23rd GST Council. Shyam Bhartia, Chairman and Hari Bhartia, Co-chairman Jubilant Foodworks said in a statement, “We welcome the move by the Government of India to reduce GST on AC restaurants from 18% to 5%. This is a very progressive step which will make eating out and ordering food at home much more affordable for consumers and will lead to a significant growth in the organized restaurant segment.” “These revisions in rates are expected to reduce prices and increase consumption and thereby bring growth for the consumer products and retail industry,” EY India said in a statement.

“Reduction of rate from 28 per cent to 18 per cent on 178 items is a step in the right direction and is indicative of a policy shift from principle of ‘equivalence’ to what is right for GST structure and consumers. It would be good if the 28 per cent slab is further pruned in next few months which will lead to fewer tax slabs in next couple of years. Due to anti-profiteering provisions and market dynamics, this should lead to the reduction in prices for the consumers, Pratik Jain, Leader-indirect Tax of PwC said.

Angel Research believes that the rate cut should have the anti-inflammatory impact. “This massive pruning of GST rates should have an anti-inflationary impact on the economy and should compensate for the inflation impact of higher oil prices,” said Mayuresh Joshi, fund manager from Angel Research.

Also Read: GST Council prunes list of goods to be taxed at 28% to 50

The cut in tax will cost Rs. 20,000 crore in revenues annually.

In a bid to ease compliance burden for traders and businesses, fine for late filing of returns be cut to Rs. 20 per day from Rs. 200 for nil liability tax filers, Revenue Secretary Hasmuksh Adhia said.

A large number of taxpayers were unable to file their return in FORM GSTR-3B within due date for the months of July, August and September, 2017.Late fee was waived in all such cases, the council said.

Exports of services to Nepal and Bhutan have already been exempted from GST. It has now been decided that such exporters will also be eligible for claiming Input Tax Credit in respect of goods or services used for effecting such exempt supply of services to Nepal and Bhutan.

The GST Council extended the due dates for furnishing certain forms.

Source :  NDTV
GST meet today: Tax ease on cards, some daily use items may become cheaper

GST meet today: Tax ease on cards, some daily use items may become cheaper

GST meet today: Tax ease on cards, some daily use items may become cheaper

The crucial Goods and Services Tax Council meeting on Friday got underway to thrash out issues including a complete review of the 28% rate slab and composition scheme for small businesses and restaurants.

The review of the 28% slab aims to place the number of products in the lower slabs of 18% and 12%. A slew of products such as ceiling fans, cement, automobile components, electrical fittings, sanitary fittings, shaving cream, cases for spectacles, goggles could move to lower brackets.

Also Read: GST Panel begins review of GST laws to remove glitches

Composition scheme may be further simplified to ease the transition pain for small and medium enterprises as also restaurants. Besides, filing of returns may be allowed on quarterly basis.

The Council is also likely to take up a proposal to incentivise digital transactions.

Congress-ruled states have called for a complete overhaul of GST and a maximum rate of 18%.


XaTTaX: Cloud and On-Premises Based GST Filing Software For India

Source :  The Economic Times