Small Scale Traders, Agriculturalists Exempted From GST Scheme

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New Delhi: The Centre and states have decided to exempt agriculturists from registering under the Goods and Services Tax (GST) regime, while the threshold for traders has been set at Rs. 20 lakh turnover.

The GST Council has also empowered commissioner-level officers to allow payment of GST levy by a taxpayer in instalments in order to mitigate any financial hardship being suffered by a taxpayer.

The GST Council, comprising Union Finance Minister Arun Jaitley and his state counterparts, today vetted the Central GST (CGST) and Integrated GST (IGST) bills, clearing decks for their introduction in the second leg of the Budget session of Parliament beginning next week.

The GST Council has decided to keep the revenue exemption limit at Rs. 20 lakh for all states with the exception of North-Eastern and the hill states where the limit will be Rs. 10 lakh.

“A business entity with an annual turnover of up to Rs. 20 lakhs 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,” a Finance Ministry statement said.

It added that an agriculturist (defined as someone who supplies produce out of cultivation of land) would not be liable to register under the GST regime.

“To prevent lock-in of capital of exporters, a provision has been made to by an exporter, 90 per cent of the claimed amount on a provisional basis,” the statement added.

Further, business entities with turnover of up to Rs. 50 lakh can avail a composition scheme under which it has to pay a much lower rate of tax and has to fulfil very minimal compliance requirements. The scheme is available for all traders, select manufacturing sectors and for restaurants in the services sector.

The Council has decided on state-wise single registration for a taxpayer for filing returns, paying taxes, and to fulfil 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,” the ministry said.

In order to provide certainty in tax matters, a provision has been made for an Advance Ruling Authority and exhaustive provisions for appellate mechanism have been made.

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