Highlights of 26th GST Council Meeting

Major Highlights of 26th GST Council Meeting

  1. Tax exemptions on imported goods :- GST Council provides a strong positive signal to exporting community by deciding to extend the available tax exemptions on imported goods for further 6 months beyond 31st March,2018.
  2. Benefits to Exporter :- Exporters presently availing various Export Promotion Schemes can now continue to avail such exemptions on their imports upto 1st October,2018, by which time an e-Wallet Scheme is expected to be in place to continue the benefits 1st October,2018. The permanent solution agreed to by the Council was to introduce an e-Wallet scheme w.e.f. 01.04.2018.
    The e-Wallet scheme is basically the creation of electronic e-Wallets, which would be credited with notional or virtual currency by the DGFT. This notional / virtual currency would be used by the exporters to make the payment of GST / IGST on the goods imported / procured by them so their funds are not blocked.
  1. GST Council also agreed to:
  • Defer the implementation of the e-Wallet scheme by 6 months i.e., upto 01.10.2018; and
  • Extend the present dispensation in terms of exemptions etc. which is available up to 31.03.2018, for a further 6 months i.e., upto 01.10.2018.
  1. Council reviewed the progress in grant of refunds to exports:- the GST Council reviewed the progress in grant of refunds to exports of both IGST and Input Tax Credit. The Council appreciated that the pace of grant of IGST refund has picked up.
  2. Thereafter, the GST Council directed GSTN to expeditiously forward the balance refund claims to the Customs/Central GST/State GST authorities, as the case may be, for their immediate sanction and disbursal.
  3. Benefit to Merchant exporters:-For merchant exporters a Special Scheme of payment of GST @ 0.1% on their procured goods was introduced.
  4. Deemed Exports :-Domestic procurement made under Advance Authorization, EPCG and EOU Schemes were recognized as ‘deemed exports‘ with flexibility for either the suppliers or the exporters being able to claim a refund of GST/IGST paid thereon. All these avenues were made available upto 31.03.2018.
  5. Grievance redressal mechanism:-A committee has been formed to look into the Grievance redressal mechanism with respect to user’s grievances surrounding the IT glitches on the GSTN
  6. Another major recommendation of the Council include deferment of the liability to pay tax on reverse charge basis till 30.06.2018. Meantime, a Group of Ministers will look into the modalities of its implementation to ensure that no inconvenience is caused to the trade & industry.
  7. TDS & TCS applicability postponed until 30th June 2018 pending procedural.
  8. No GST rate changes announced.
  9. Simplification of return filing and Scheme of input credit claim
  • To Focus on: Origin point for ITC claim whether at the time of Supplier’s Sales Invoices uploading or at the time of Return filing by the buyer will be most likely to be settled this meet
  • Invoice upload by the Supplier & recipient likely to be regular ongoing process and Invoices accepted by the supplier to be accepted or rejected by the recipient and accordingly acceptances up to a certain date of the month shall be processed for ITC claims of the relevant month
  • A system of Single monthly return & the Quarterly reconciliation of Invoices/documents uploaded is on the cards. The new Return filing may be implemented on trial basis before the full-fledged applicability. Also, two due dates in the month likely to be fixed for filing returns for large and small taxpayers to address the tech crashes
  • Affected taxpayers: Those who are liable to file GSTR-1, GSTR-2 & GSTR-3
  • Unaffected taxpayers may be taxpayers filing only GSTR-4, GSTR-5, GSTR-5A or GSTR-6
  • The GSTR-3B filing facility which expires on March 31 likely to continue for few more months.
  1. 26th Meeting of the Goods & Services Tax (GST)  recommended the introduction of e-way Bill for Inter-State movement of goods across the country from 01st April 2018.
  2. For Intra-State movement of goods, e-way Bill System will be introduced w.e.f. a date to be announced in a phased manner but not later than 01st June, 2018.
  3. In case of movement of goods by railways, airways and waterways, the e-way bill can be generated even after commencement of movement of goods.Movement of goods on account of Bill-To-Ship-To supply will be handled through the capturing of place of despatch in PART-A of e-way bill.
  4. Composition scheme changes-
  • Enhancing threshold for Composition Scheme to Rs 3-5 crore from the current limit of Rs 1 crore.
  • RCM under section 9(4) to be made applicable to a composition dealer as well.

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