GST Council gives relief to exporters, small businesses

GST Council gives relief to exporters, small businesses


Recently  the GST Council announced a slew of decisions to reduce compliance burden for exporters and small businesses.

GST Council

  • The GST bill set up a GST Council.
  • The GST Council aims to develop a harmonized national market of goods and services

According the GST Bill, the President must constitute a GST Council within sixty days of this Act coming into force. The composition of the GST Council includes:

  • The Union Finance Minister (as Chairman),
  • The Union Minister of State in charge of Revenue or Finance, and
    The Minister in charge of Finance or Taxation or any other Minister, nominated by each state government.
  • The decisions of the GST Council will be made by three-fourth majority of the votes cast. The centre shall have one-third of the votes cast, and the states together shall have two-third of the votes cast.

The GST Council will make recommendations on:

  • taxes, cesses, and surcharges to be subsumed under the GST;
  • goods and services which may be subject to, or exempt from GST;
  • the threshold limit of turnover for application of GST;
  • rates of GST;
  • model GST laws, principles of levy, apportionment of IGST and principles related to place of supply;
  • special provisions with respect to the eight north eastern states, Himachal Pradesh, Jammu and Kashmir, and Uttarakhand; and
    other related matters.
  • The GST Council may decide the system of resolving disputes arising out of its recommendations. The GST Council will also decide when the GST would be levied on petroleum crude, natural gas, high speed diesel, aviation turbine fuel and motor spirit (petrol).

Problem faced by exporter

  • The credit blockage felt by exporter was causing a liquidity problem.

Relief to exporter

  • each exporter will get an e-wallet in which a nominal sum will be deposited for tax credit purposes, which will be offset against the credit refund when it happens.
  • A small GST levy of  0.1% on export till March 31, 2018.
  • Exporter will get tax refund of july by october 10 of july and by october 18 for august.

Relief for SME sectors

  • Business with turnover of upto 1.5 crore allowed to file quarterly refund instead of monthly.
  • Compliance burden of medium and small taxpayer under GST being cut.

The GST Council also reduced the tax rates on 27 items.

These include sliced dried mangos, khakhra and plain chappatis, unbranded ayurvedic medicines, plastic, rubber and paper waste, yarn, diesel engine parts, pump parts, e-waste and several services.

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