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On 21st July 2018, the GST Council has reduced the tax rates on most of the items that are used in day-to-day life. Electrical appliances such as TV (up to 27’’), Washing Machine, Refrigerator, Mixer, Juicer, Grinder etc. have been reduced from 28% GST Slab Rate to 18% GST Slab Rate. Not only this, the Sanitary Napkins have been exempted from the GST Rates. These new rates will come into an effect from 27th July 2018. The rate reductions are estimated to cost the Government exchequer nearly Rs 7000 Crore.
Earlier, the Council had revised the tax rates on 29 Items in January 2018. In November 2017, the Council had brought down over 200 Items from 28%, 18%, and 12% into lower tax brackets.
The decisions taken in the 28th GST Council Meeting Updates are as follows-
Quarterly Returns have been approved for the Tax Payers who have a turnover of less than Rs 5 Core (tax payments will be continued on the monthly basis).
White Goods such as Refrigerator, Washing Machines, TV (up to 27’’), Grinders. Juicers, Mixers, Electric Iron, Water heaters and Coolers, Video Games, Shaver’s, Lithium Iron Batteries etc. have been cut down from 28% to 18% GST Slab Rates.
Sanitary Napkins have been exempted from GST Tax Rate.
GST on Bamboo Flooring has been put under 12% GST Slab.
Hotels to be taxed on actual tariff basis, not on the declared tariff.
Rates on paints, wall putty, and Varnish have been dropped down from 28 percent to 18% percent.
Common use foot wares worth Rs 1000/- will be taxed 5% GST.
Ethanol Oil for Companies will be taxed for 5%.
GST Rates of the Leather Goods has been reduced from 28% to 18% GST Tax Rate Slab.
GST Rates cut to 18% for special purpose vehicles, work truck, trailers.
Rates on scents, toilet spray, are now under 18% GST Slab.
Marbles, Stones, Wood deities have been exempted from GST. Rakhis, fortified Milk, are also exempted.
Handicraft Items will be now taxed at 12%.
The GST Rates on Handbags, jewelry box, wooden box for paintings, art ware for paintings, handmade lamps etc. are reduced to 12%.
GST on imported UREA has been reduced to 5%.
The GST Council have not come up with the decision on sugar cess. This will be decided in the next meeting of GST Council. The GST Council has cleared 48 amendments which will be passed in the Parliament. The Council will be introducing RFID Tags along with Goods and Services Tax Network (GSTN) for transporters to reduce harassment of transporters.
On 18th January 2018, 25th GST meeting was held and the government brought down tax rates on 29 goods and 53 services, with its point of convergence on easing return filing processes.
Finance Minister Arun Jaitley stated that
The eminent economist predicts that these slashed rates might lead to revenue loss of 1,000 crores (156.6 million) to 1,200 crores. This rate change is the latest so far the government has made to the GST.
Take a look at the below mentioned finalised goods:
Recommendation for reduction from 28% to 18%
- 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
- Buses (for use in public transport) which runs on biofuels to be particular
Recommendations for reduction from 18% to 12%
- Sugar boiled confectionary
- Drinking bottles packed in 20 litres bottles
- Fertilizers grade Phosphoric acid
- And the below mentioned Bio–pesticides
- Bacillus thuringiensis var. Israelensis
- Bacillus thuringiensis var. Kurstaki
- Bacillus thuringiensis var. Galleriae
- Bacillus sphaericus
- Trichoderma viride
- Trichoderma harzianum
- Pseudomonas fluoresens
- NPV of Helicoverpaarmigera
- NPV of Spodopteralitura
- Neem based pesticides
- Bamboo wood building joinery
- Drip irrigation system including laterals, sprinklers
- Mechanical Sprayer
Recommendations for reduction from 18% to 5%
- Tamarind Kernel Powder
- Mehendi Paste in cones
- LPG supplied for supply to households domestic consumers by private LPG distributors
- Scientific and technical instruments, apparatus, equipment, accessories, parts, components, spares, tools, mock-ups, and modules, raw materials and consumables required for launch vehicles and satellites and payloads
Recommendations for reduction from 12% to 5%
- Articles of straw of esparto or of other plaiting materials; basket – ware and wickerwork
Recommendations for reduction from 12% to 18%
- Cigarette filter rods
Recommendations for reduction from 12% to 5% (with no return of unutilized input tax credit)
- Velvet fabrics
Recommendations for reduction from 3% to 0.25%
- Diamond and precious stones
NIL GST Rates
- Parts and accessories for the manufacture of hearing aids
- De – oiled rice bran
Recommendations for reduction from nil to 5%
- Rice bran (other than de – oiled rice bran)
Finance Minister Arun Jaitley has also added that in the next meeting the council meeting will consider including new items in the rate deduction category which may include gasoline and real estate.
GST Rate Cut on Services
In services segment, government has decided to slash rates on the following addresses:
- Transportation of Crude
- Jet fuel
- Exploration and drilling of oil and natural gas
Also note that theme park admission rates has also been decided to get a rate cut such as water park, joy rides, merry go rounds, go carting and ballet will now be taxed at 18% instead of 28%. Also the common effluent treatment plans services will get a cut from 18% to 12%.
He also added that they will consider simplifying the GST return filing process. The next meeting is expected to happen later on this month.
Most of the Indian Business have started implementing GST after 1st July 2017. Nowadays, the invoices and the bills are also being used in the GST Format. Thus, to make the GST work smoother, the Government relaxed the GST Return Filing for 2 months. The Tax Authorities have introduced a simple return form called the GSTR-3B Form. This form can be used during the time period of July of the current year to March of the next year. Every registered taxpayer needs to file a separate GSTR-3B for each GSTIN.
The GSTR-3B is a monthly return that is filed by the regular dealers from the time period of July 2017 to March 2018. It is more of a self-declaration return form.
In this article, we will be talking about the Basics of the GSTR-3B and other information regarding the GSTR-3B.
What is the GSTR-3B Form
The GSTR-3B Form is a simple return form that is introduced by The Central Board of Excise and Custom (CBEC) for July 2017 to March 2018. The form contains the details of the inward and outward supplies. Make sure that you have been provided with an invoice level information with this form. Only the total values for each field needs to be provided.
You need to file a separate GSTR-3B for each GSTIN you have. The tax-liability of GSTR-3B must be paid by the last date of filing the GSTR-3B for that month.
Due Date of GSTR-3B
The GSTR-3B has to be filed by 20th of the next month till March 2018. Like for an example, the due date of the return for the period November 2017 is 20th December 2017.
Who are Eligible to file GSTR-3B
Every person who has registered for GST is eligible for filing a GSTR-3B. This return form must be filed and submitted by you even if you do have any transactions during these months.
Who are not Eligible to file a GSTR-3B
The following sections of registrants are not eligible for filing a GSTR-3B:
- Input Service Distributors
- Composition Dealers
- Suppliers of Online Information and Database across the Retrieval Services (OIDAR), who have pay taxes themselves (as per Section 14 of IGST Act).
- Non-Resident Taxable Person.
Revising of GSTR-3B
The GSTR-3B form cannot be revised.
Late Fee and Penalty
The GSTR-3B filing is mandatory. Even if a taxpayer who does not have any transactions during a month has to file a Nil Return.
An interest of 18% per annum is applicable. It has to be calculated by the taxpayer on the amount of the outstanding tax that has to be paid. The time period will be from the next day of the due date for filing to the date of payment.
The late fee is charged for filing GSTR-3B after the due date. The late fee penalty is Rs 50 per day of delay and Rs 20 per day of delay for taxpayers having a Nil Tax Liability for the month.
In the 23rd GST Council meeting headed by the Finance minister Arun Jaitley, that took place in Guwahati, Assam on November 10, 2017, the council has recommended some major shift in items in the GST (Goods and Service Tax) tax bracket.
In the meeting, the council has taken the 28% tax slab into reconsideration and decided to keep the highest 28% tax on luxury and sinful items. Hence, 177 items have been shifted to the 18% tax bracket.
18% to 12% Tax bracket
- Condensed milk
- Refined sugar and sugar cubes
- Curry paste, mayonnaise and salad dressings, mixed condiments and mixed seasoning
- Diabetic food
- Medicinal grade oxygen
- Printing ink
- Hand bags and shopping bags of jute and cotton
- Hats (knitted or crocheted)
- Parts of specified agricultural, horticultural, forestry, harvesting or threshing machinery
- Specified parts of sewing machine
- Spectacles frames
- Furniture wholly made of bamboo or cane
Services that are kept under this tax bracket are
- state – run lotteries,
- Non – AC hotels,
- business class air ticket,
- work contracts
28% to 18% Tax bracket
- Wire, cables, insulated conductors, electrical insulators, electrical plugs, switches, sockets, fuses, relays, electrical connectors
- Electrical boards, panels, consoles, cabinets etc for electric control or distribution
- Particle / fibre boards and ply wood. Article of wood, wooden frame, paving block
- Furniture, mattress, bedding and similar furnishing
- Trunk, suitcase, vanity cases, brief cases, travelling bags and other hand bags, cases
- Detergents, washing and cleaning preparations
- Liquid or cream for washing the skin
- Shampoos; Hair cream, Hair dyes (natural, herbal or synthetic) and similar other goods; henna powder or paste, not mixed with any other ingredient;
- Pre – shave, shaving or after-shave preparations, personal deodorants, bath preparations, perfumery, cosmetic or toilet preparations, room deodoriser
- Perfumes and toilet waters
- Beauty or make – up preparations
- Fans, pumps, compressors
- Lamp and light fitting
- Primary cell and primary batteries
- Sanitary ware and parts thereof of all kind
- Articles of plastic, floor covering, baths, shower, sinks, washbasins, seats, sanitary ware of plastic
- Slabs of marbles and granite
- Goods of marble and granite such as tiles
- Ceramic tiles of all kinds
- Miscellaneous articles such as vacuum flasks, lighters,
- Wrist watches, clocks, watch movement, watch cases, straps, parts
- Article of apparel & clothing accessories of leather, guts, fur skin, artificial fur and other articles such as saddler and harness for any animal
- Articles of cutlery, stoves, cookers and similar non electric domestic appliances
- Razor and razor blades
- Multi-functional printers, cartridges
- Office or desk equipment
- Door, windows and frames of aluminium.
- Articles of plaster such as board, sheet,
- Articles of cement or concrete or stone and artificial stone,
- Articles of asphalt or slate, Articles of mica
- Ceramic flooring blocks, pipes, conduit, pipe fitting
- Wall paper and wall covering
- Glass of all kinds and articles thereof such as mirror, safety glass, sheets, glassware
- Electrical, electronic weighing machinery
- Fire extinguishers and fire extinguishing charge
- Fork lifts, lifting and handling equipment,
- Bull dozers, excavators, loaders, road rollers,
- Earth moving and levelling machinery,
- Cooling towers, pressure vessels, reactors
- Crankshaft for sewing machine, tailor’s dummies, bearing housings, gears and gearing; ball or roller screws; gaskets
- Electrical apparatus for radio and television broadcasting
- Sound recording or reproducing apparatus
- Signalling, safety or traffic control equipment for transports
- Physical exercise equipment, festival and carnival equipment, swings, shooting galleries, roundabouts, gymnastic and athletic equipment
- All musical instruments and their parts.
- Artificial flowers, foliage and artificial fruits
- Explosive, anti-knocking preparation, fireworks
- Cocoa butter, fat, oil powder,
- Extract, essence ad concentrates of coffee, miscellaneous food preparations
- Chocolates, Chewing gum / bubble gum
- Malt extract and food preparations of flour, groats, meal, starch or malt extract
- Waffles and wafers coated with chocolate or containing chocolate
- Rubber tubes and miscellaneous articles of rubber
- Goggles, binoculars, telescope,
- Cinematographic cameras and projectors, image projector,
- Microscope, specified laboratory equipment, specified scientific equipment such as for meteorology, hydrology, oceanography, geology
- Solvent, thinners, hydraulic fluids, anti-freezing preparation
Restaurants in hotel premises having room tariff of Rs 7500 and above, telecom services, IT services, branded garments and financial services, Outdoor catering
28% Tax Slab
The tax fitment committee have decided to keep only 50 luxuries and sin items to taxed at the highest tax bracket i.e. 28%. Let us look at some of these items which are as follows:
In total 50 luxury and sin products will be taxed at 28% which includes
- pan masala,
- aerated water,
- ceramic tiles,
- water heater,
- weighing machine,
- washing machine,
- vending machines,
- vacuum cleaner,
- aircraft for personal use.
Private – run lotteries authorised by the states, race club betting, cinema will attract tax 28 per cent tax slab under GST.
The Indian Government on Wednesday has seized the issues of the Exporters complaining about the delay in the granting of the refunds associated with the Integrated Goods and Service Tax (IGST) and Input Tax Credit which states the tax paid on the goods that are exported out of India.
Certain sections of the media have reported that there are miscalculations and incorrect estimations of the refund amounts made from the period of the month July to October 2017. It has also been observed that there are certain errors such as Incorrect Shipping Bill Number in GSTR1, mis-match of the Invoice number, IGST amount paid, wrong bank account number etc. which led to the delay and rejection in the grant of the refunds.
The media said that the quantum IGST Refund Claims filed through the Shipping Bills during the period July to October is Rs 6500 Crore approx. and the quantum of refund of the unutilized tax credit on the input and input tax services as per the RFD 01A applications filed on the GSTN Portal is Rs 30 Crore approx. This information has been made available to the Exporters on the ICEGATE Portal so that they could rectify the errors as early as possible.
With regard to the IGST paid on the goods that are exported outside India, a mass number of refund claims on the exports made in July 2017 which was due was also sanctioned. The IGST Refund claims for the exports during the month of August, September and October are also sanctioned wherever the returns are filed.
The statement also comprises of the required information regarding the sanction of the refund of the IGST paid, which includes the filing of the GSTR-3B and the table 6A of GSTR 1 on the GSTN Portal and the Shipping Bills on Customs EDI System by the Exporter. The facility for filing GSTR 1 for August 2017 will be ready by 4th December. If any wrong entries are made on the month of July then the Table 9 of GSTR1 August will permit the amendments to GSTR1 of July 2017.
For the refund of the unutilized Input Tax Credit or other input services linked with the exports of goods, the exporters should file an application in FORM GST RFD – 01A on the common portal. The portal provides the information regarding the amount claimed as refund which is debited from the Electronic Credit Ledger of the Exporter.
A proof of debit called Acknowledgement Receipt Number (ARN No.) is generated on the GSTN Portal which is mentioned in the FORM GST RFD 01A. This form is submitted manually to the Jurisdictional Officer. The Exporters need to make sure that they submit all the necessary documents along with the FORM RFD 01A for timely sanction of refund as the Government is taking measures pacify the difficulty and provide quick contribution of the refunds.