New Delhi [India], March 4 (ANI): The eleventh Goods and Services Tax (GST) Council meeting held at Vigyan Bhawan on Saturday introduced a compensation scheme for business entities with turnover up to Rs. 50 lakhs.
As per the council, such entities can avail the benefit of a composition scheme under which it has to pay a much lower rate of tax and has to fulfill very minimal compliance requirements. The Composition Scheme is available for all traders, select manufacturing sectors and for restaurants in the services sector.
Meanwhile, a business entity with an annual turnover of up to Rs. 20lakh would not be required to take registration in the GST regime, unless he voluntarily chooses to do so to be a part of the input tax credit (ITC) chain. The annual turnover threshold in the Special Category States (as enumerated in Article 279A of the Constitution such as Arunachal Pradesh, Sikkim, Uttarakhand, Himachal Pradesh, Assam and the other States of the North-East) for not taking registration is Rs. 10lakh.
In the Services sector, the existing mechanism of Input Service Distributor (ISD) under the Service Tax law has been retained to allow the flow of ITC in respect of input services within a legal entity.
With regards to tax payment, a state-wise single registration will be maintained for filing returns, paying taxes, and to fulfill other compliance requirements. Most of the compliance requirements would be fulfilled online, thus leaving very little room for physical interface between the taxpayer and the tax official.
A taxpayer has to file one single return state-wise to report all his supplies, whether made within or outside the State or exported out of the country and pay the applicable taxes on them. Such taxes can be Central, State, Integrated and Union Territory GST.
The remaining two Bills namely, State GST and the Union Territory GST, which would be almost a replica of the CGST Act, would be taken-up for approval in the next meeting of GST Council scheduled on March 16 2017.
The GST Council chaired by Finance Minister Arun Jaitley, approved the draft CGST Bill and the draft IGST Bill as vetted by the Union Law Ministry. This clears the deck for the Central Government to take these two Bills to the Parliament for their passage in the ongoing Budget Session. (ANI)