New Delhi: The all-powerful Goods and Services Tax (GST) Council will hold its 22nd meeting on Friday and is likely to consider relaxing the return filing cycle for small and medium enterprises.
Implemented on July 1, the GST replaced 17 central and state taxes to unite the country as one market but has been facing starting trouble. Among the challenges are the monthly filing of returns and the glitches in the GST Network portal.Moneycontrol.com quoted a senior government official as saying that a change in the return filing cycle was likely. “A quarterly return filing could be implemented for small businesses,” the official said.
The official added that the cut-off of annual turnover which qualifies a company as small business will be decided by the GST Council on Friday.
At present, all businesses have to file three monthly returns and one annual return.
Till August 28, more than 36 lakh businesses had filed first tax returns under the GST regime out of a total of 68.2 lakh taxpayers and tweaks to the filing mechanism for small businesses may help push up the compliance rate.
The GST Council on Friday may also consider reopening the registration for composition scheme for the third time. The composition scheme is an alternative method of levy of tax designed for small taxpayers whose turnover is up to Rs 75 lakh; Rs 50 lakh in the case of eight north-eastern states and Himachal Pradesh. The objective behind it is to bring simplicity and reduce the compliance cost for small taxpayers.
The scheme is optional under which manufacturers other than those of ice cream, pan masala and tobacco products have to pay a 2 per cent tax on their annual turnover. The tax rate is 5 per cent for restaurant services and 1 per cent for traders.
“If the Council approves, registration for the composition scheme will be open till March 31, 2018. The annual turnover for businesses opting for the scheme may be increased up to Rs 1 crore,” another official told Moneycontrol.com.
As per the Central GST Act, businesses are eligible to opt for the composition scheme if a person is not engaged in any inter-state outward supplies of goods and not into making any supply of goods through an electronic commerce operator who is required to collect tax at source.
A composition taxpayer is not required to keep detailed records that a normal taxpayer is supposed to maintain.
The GST Council may also defer the reverse charge mechanism. The mechanism is one wherein the tax is applicable on a registered entity buying a good or service from an unregistered one.
This will be the 22nd meeting of the GST Council. The Group of Ministers, under Sushil Modi, set up to look into GSTN glitches are likely to brief the Council on the portal’s functioning.
With over 33 lakh businesses filing the final GSTR-1 return, the GoM has tasked GSTN to send reminder text messages to the remaining 20 lakh businesses that are yet to submit the tax forms.
The last date for filing of final sales returns for July in GSTR-1 form is October 10, while the date for uploading of purchase returns in GSTR-2 is October 31. The final GSTR-3, matching GSTR-1 and 2, is to be filed by November 10.
The GoM in its meeting on Wednesday has asked GSTN and Infosys, which manages the IT infrastructure, to brace up for handling the rush of last-minute filers.
Source:-news 18