SUMMARY OF GST 25th COUNCIL MEETING
The 25th GST Council Meeting was held at New Delhi on the 18th of January 2018. There was a higher rate, complexities & various other measures which made business difficult; so the committee has taken steps to improve ease of doing business. GST rates have also be reduced for various goods and services.
Amendment in GST rules & regulations are as under:
- Penalty Reduction:
The penalty for late filing of GST returns has been further reduced by the 25th GST Council Meeting. Now, any business that failed to file GSTR1 return, GSTR5 return or GSTR5A return will only have to pay a penalty of Rs.50 per day of default. In case of failure to file NIL GST return, the penalty has been reduced to just Rs.20 per day. Nandan Nilekani made a detailed presentation on simplification of GST returns filing to avoid penalty on late filings. We can see his videos on GST website.
- Cancellation of GST Registration obtained after 1st July 2017:
Persons who registered voluntarily on GST Portal can now surrender their GST Registration. Previously they were barred from surrendering their GST registration before end of one year from date of registration. The rules have now been modified to allow cancellation of voluntary GST registration before 1 year.
- Cancellation of Migrated GST Taxpayers:
Persons who obtained GST registration mandatorily due to migration from VAT or Service Tax or Central Excise can cancel their GST registration before 31st March 2018.
- Introduction of E-Way Bill:
The Government expects to roll out a nationwide GST e-way bill system for interstate movement of goods from 1sFebruaryry 2018. The Government expects to rollout eway bill system for intrastate movement of goods on later than 1st June 2018. However, no date has been announced by the Government mandating eway bill for intrastate movement of goods. 15 states have informed the Council that they will start intra-state the e-way bill from the same month.
The Government has begun rolling out the e-way bill mechanism on a trial basis through ewaybill.nic.in. Stakeholders can login to ewaybill.nic.in and generate, cancel or modify GST eway bill on a trial basis. Once the system is ready, the GST eway bill system will be made available on ewaybillgst.gov.in.
- Rate Changes of Various Goods
The following are the GST rate changes for goods announced in the 25th GST Council Meeting:
|Goods||Old Rate||New Rate|
|Cigarette filter rods||12.00%||18.00%|
|Rice bran (other than de-oiled rice bran)||NIL||5.00%|
|Diamonds and precious stones||3.00%||0.25%|
|Articles of straw, of esparto or of other plaiting materials; basketware and wickerwork||12.00%||5.00%|
|Velvet fabric with no refund of unutilised input tax credit||12.00%||5.00%|
|Tamarind Kernel Powder||18.00%||5.00%|
|Mehendi paste in cones||18.00%||5.00%|
|LPG supplied for supply to household domestic consumers by private LPG distributors||18.00%||5.00%|
|Scientific and technical instruments, apparatus, equipment, accessories, parts, components, spares, tools, mock ups and modules, raw material and consumables required for launch vehicles and satellites and payloads||18.00%||5.00%|
|Sugar boiled confectionary||18.00%||12.00%|
|Bio-diesel & Bio-pesticides||18.00%||12.00%|
|Fertilizer grade Phosphoric acid||18.00%||12.00%|
|Drinking water packed in 20 litters bottles||18.00%||12.00%|
|Bamboo wood building joinery||18.00%||12.00%|
|Drinking water packed in 20 litters bottles||18.00%||12.00%|
|Drip irrigation system including laterals, sprinklers||18.00%||12.00%|
|All types of old and used motors vehicles [other than medium and large cars and SUVs] on the margin of the supplier of subject to the conditions that no input tax credit of central excise duty /value added tax or GST paid on such vehicles has been availed by him||28.00%
|Old and used motor vehicles [medium and large cars and SUVs] on the margin of the supplier, subject to the condition that no input tax credit of central excise duty/value added tax or GST paid on such vehicles has been availed by him||28.00%
|Buses, for use in public transport, which exclusively run on bio-fuels||28.00%
- Exemption of Various Services
- Exemption of supply of services by way of providing information under RTI Act, 2005.
- Exemption of legal services provided to Government, Local Authority, Governmental Authority and Government Entity.
- Exemption of services relating to admission to, or conduct of examination provided to all educational institutions, as defined in the notification.
- Exemption of services by educational institution by way of conduct of entrance examination against consideration in the form of entrance fee.
- Exemption of services by way of fumigation in a warehouse of agricultural produce.
- Exemption of subscription of online educational journals/periodicals by educational institutions who provide degree recognized by any law.
- Exemption of service provided by way of renting of transport vehicles provided to a person providing services of transportation of students, faculty and staff to an educational institution providing education upto higher secondary or equivalent.
- Exemption of services provided by and to FIFA and its subsidiaries directly or indirectly related to any of the events under FIFA U-20 World Cup in case the said event is hosted by India.
- To exempt government’s share of profit petroleum from GST and to clarify that cost petroleum is not taxable per se.
- Exemption of reinsurance services in respect of insurance schemes exempted under S. No. 35 and 36 of notification No. 12/2017-CT (Rate).
- Exemption of service by way of transportation of goods from India to a place outside India by air upto 30th September, 2018.
- Exemption of service by way of transportation of goods from India to a place outside India by sea and provide that value of such service may be excluded from the value of exempted services for the purpose of reversal of ITC upto 30th September, 2018.
- Exemption of services provided by the Naval Insurance Group Fund by way of Life Insurance to personnel of Coast Guard under the Group Insurance Scheme of the Central Government retrospectively e.f. 01st July, 2017.
- Exemption of IGST payable under section 5(1) of the IGST Act, 2017 on supply of services covered by item 5(c) of Schedule II of the CGST Act, 2017 to the extent of aggregate of the duties and taxes leviable under section 3(7) of the Customs Tariff Act, 1975 read with sections 5 & 7 of IGST Act, 2017 on part of consideration declared under section 14(1) of the Customs Act, 1962 towards royalty and license fee includible in transaction value as specified under Rule 10 (c) of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007.
- Exemption of dollar denominated services provided by financial intermediaries located in IFSC SEZ, which have been deemed to be outside India under the various regulations by RBI, IRDAI, SEBI or any financial regulatory authority, to a person outside India.
- Exemption of
(a) services provided by government or local authority to governmental authority or government entity, by way of lease of land, and
(b) supply of land or undivided share of land by way of lease or sub lease where such supply is a part of specified composite supply of construction of flats etc. and to carry out suitable amendment in the provision relating to valuation of construction service involving transfer of land or undivided share of land, so as to ensure that buyers pay the same effective rate of GST on property built on leasehold and freehold land.
- Rate Changes of Various Services
The following are the GST rate changes for Services announced in the 25th GST Council Meeting:
|Services||Old Rate||New Rate|
|Services by way of admission to theme parks, water parks, joy rides, merry-go-rounds, go-carting and ballet||28.00%||18.00%|
|Common Effluent Treatment Plants services of treatment of effluents||18.00%||12.00%|
|Job work services rate for manufacture of leather goods||18.00%||5.00%|
|Transportation of petroleum crude and petroleum products||18.00%||5.00% (without ITC)
18.00% (with ITC)
|Works Contract Services||18.00%||12.00%|
|Small housekeeping service providers providing services through ECO||5.00% (without ITC)
|Construction of metro and monorail projects (construction, erection, commissioning or installation of original works)||18.00%||12.00%|