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GST Council To Decide On Rates In May
The all-powerful GST Council has approved five amended rules for the Goods and Services Tax regime and gave "tentative" nod to the remaining four as the central government sprints to meet the July 1 rollout target
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The all-powerful GST Council has approved five amended rules for the Goods and Services Tax regime and gave "tentative" nod to the remaining four as the central government sprints to meet the July 1 rollout target.
The final nod to the four rules as also fixation of GST rates for major commodities and services will be done in the next meeting in Srinagar on May 18-19, Finance Minister Arun Jaitley said.
Headed by Jaitley and comprising representatives of all states, the Council gave final approval for changes in rules for filing tax returns in the new regime, registration of entities, payment of GST, invoicing and refunds to make them compatible with GST laws approved by the Lok Sabha this week.
The remaining rules on how input tax credit is to be calculated and claimed, valuation of supply of goods and services, method for intimation for opting for composition levy and transitional rules were given "tentative" approval, Jaitley told reporters after the 13th meeting of the Council.
He said the five rules which received final nod from the Council were originally cleared at the September 30, 2016 meeting but had to undergo minor changes following stakeholder comments and bringing them in line with model GST law.
In the registration rules, the changes approved include certification of registration being digitally signed by proper officer and procedure for grant or cancellation of unique identify number.
The changes in rules for filing returns says that certain category of persons need not file annual returns.
Also, the requirement of registration of debit/credit card for payment of tax with the GST-Network has been omitted from the payment rules.
Refund rules now provide for new norm for refund of advance tax deposited by non-resident taxable person, while the changed invoice rules provide for consolidated tax invoice on daily basis instead of individual invoices for supplies less than Rs 200.
"GST input tax rules, valuation rules, transitional provisions, composition... Those rules have been tentatively approved by the GST Council," Jaitley said.
He said the Council has decided that the final corrected drafts be put up for industry to make suggestions.
"Once we incorporate the suggestions, if any, then this tentative approval that we have made today would in the next meeting be taken up for consideration and affirm for final approval," he said.
Stating that five sets of rules -- registration, return, refund and invoice, debit and credit have been approved, he said these were prepared prior to formulation of the GST laws.
"These rules had to be altered to bring in consonance with the Acts."
He added: "The thing which has come out today is that out of nine set of rules, the original five which we had approved, have been corrected in terms of the amendments and brought in consonance with the Acts, those now become final. And the four new rules have been tentatively approved, will be put in public domain and in the next meeting will be taken up for consideration."
Jaitley said the meeting on May 18-19, besides finalising the rules, will also take up for consideration the rate structure in relation to individual commodities.
"In the meanwhile, the officers committee will start working on the fitment of those rates," he added.
The four rules on which the Council gave tentative approval are likely to be put up in the public domain by tomorrow and industry can give its views on these. The suggestions would be considered by the Council in its next meeting, officials said.
The GST Council has already decided on a 4-tier rate structure of 5, 12, 18 and 28 per cent and a cess on the peak rate for demerit and luxury goods.
The Lok Sabha earlier this week approved 4 supplementary legislations-- Central GST, Integrated GST, Union Territory GST and Compensation law.
ClearTax.com CEO and Founder Archit Gupta said: "The GST rate will be decided only in May which may lead to delays in system implementation of rate changes. Once new rules and rates are finalised a period of testing may be essential to the system. MSMEs and SMEs will require more time to prepare themselves with respect to understanding input credit changes and pricing changes."