The GST council holds a GST Council Meeting every few months to discuss rate changes or to update new changes in GST law. The GST council meetings are highly anticipated and are crucial for the growth and development of business communities in the country. Until now, we have had 46 GST council meetings that laid guidelines, rules and regulations plus law changes, exemptions among other significant changes in GST.
What is GST Council?
GST – Goods and Service Taxation received a go-ahead from the government of India in 1999. It was then worked upon for years and was finally implemented in July 2017. GST is governed by the GST council which is a joint forum for the Center and the States.
Why is the GST Council formed?
The council is responsible for modifying, reconciling or procuring any law or regulation related to GST. They make key decisions regarding GST rate changes, filing due dates, tax laws, and deadlines among other significant tax and other related rules for all states. The GST Council conducts GST Council Meetings to take these significant decisions and then make the official announcement of the same.
Members of the GST Council
The GST Council is headed by the chairperson who is the union finance minister of the country and is assisted by finance ministers of all states of India. The vice-chairperson of the council is chosen by the State Finance Ministers’ who is generally one amongst themselves. The current chairperson of the GST Council is Honorable FM Nirmala Sitharaman.
GST Council Meeting Updates
Following are all the changes and upgrades that took place in every GST council meeting till date:
48th GST Council Meeting Highlights
Decriminalization under GST: The Council has recommended to:
- Raise the minimum threshold of tax amount for launching prosecution under GST
from Rs. One Crore to Rs. Two Crores, except for the offence of issuance of
invoices without supply of goods or services or both;
- Reduce the compounding amount from the present range of 50% to 150% of tax
amount to the range of 25% to 100%;
- Decriminalize certain offences specified under clause (g), (j) and (k) of sub-section
(1) of section 132 of CGST Act, 2017, viz.-
- obstruction or preventing any officer in discharge of his duties;
- deliberate tempering of material evidence
- failure to supply the information.
- Raise the minimum threshold of tax amount for launching prosecution under GST
Facilitate e-commerce for micro-enterprises
The Council approved the amendments in the GST Act and GST Rules, along with issuance of relevant notifications, to enable in-principle approval for allowing unregistered suppliers and composition taxpayers to make intra-state supply of goods through E-Commerce Operators (ECOs),
subject to certain conditions.
There were several GST Rule Amendments made and subsequent new circulars were released.
Several new measures were taken for streamlining compliances in GST. For a detailed update, please read: 48th GST Council Meeting
47th GST Council Meeting Highlights
|Rate rationalization to remove inverted duty structure||Goods or Service||From||To|
|Works contract for roads, bridges, railways, metro, effluent treatment plant, crematorium etc.||12%||18%|
|Works contract supplied to central and state governments, local authorities for historical monuments, canals, dams, pipelines, plants for water supply, educational institutions, hospitals etc. & sub-contractor thereof||12%||18%|
|Works contract supplied to central and state governments, union territories & local authorities involving predominantly earthwork and sub-contracts thereof||5%||12%|
|Refund of accumulated ITC not to be allowed on Edible oil and Coal|
|Withdrawal of exemptions||Services exempt now taxable including – Services by RBI,IRDA,SEBI,FSSAI, GSTN; Renting of residential dwelling to business entities (registered persons); Services provided by the cord blood banks by way of preservation of stem cell (and more)||Nil||TBD|
|Hotel accommodation priced up to Rs. 1000/day||Nil||12%|
|Room rent (excluding ICU) exceeding Rs 5000 per day per patient charged by a hospital||Nil||5% w/o ITC.|
|GST will not be exempted now on for prepackaged and pre-labelled retail pack in terms of Legal Metrology Act, including pre-packed, pre-labelled curd, lassi and butter milk.|
|Rate changes||Cut and Polished diamonds||0.25%||1.5%|
|Transport of goods and passengers by ropeways.||18%||5% (with ITC of services)|
|Renting of truck/goods carriage where cost of fuel is included||18%||12%|
Reporting the details in GSTR 3B
- Reversal of ITC which is permanent in nature and non-reclaimable needs to be shown in Table 4B (1)
- And which is not permanent in nature and can be claimed in the future needs to be shown in Table 4B(2)
- Correct disclosure of PoS of Customer in Table 3.2. (Supplies to Unregistered, Composition and UN bodies)
- Any amendments in GSTR 1 should be also given effect in Table 3.2 in subsequent periods
There are several more changes and decisions made in the meeting. For a detailed update, please read: 47th GST Council Meeting Highlights
46th GST Council Meeting Highlights
- Only one major decision was taken in the 46th GST Council Meeting. The council decided to retain the status quo on the rate at which Textiles are taxed. So, GST Rate for textiles will remain at 5%.
For a detailed update, please read: 46th GST Council Meeting Highlights
45th GST Council Meeting Highlights
- Concessions have been given for COVID related drugs
- GST Rate changes for multiple goods and services
- Inverted Duty Structure was implemented for the textile and footwear sector from 1st January 2022.
- Relaxation in the requirement of filing FORM GST ITC-04
- Aadhaar authentication of registration to be made mandatory for being eligible for filing refund claim and application for revocation of cancellation of registration.
- Rule 59(6) of the CGST Rules to be amended with effect from 1st January 2022 to provide that a registered person shall not be allowed to furnish FORM GSTR-1 if he has not furnished the return in FORM GSTR-3B for the preceding month.
For a detailed update, please read: 45th GST Council Meeting Highlights
44th GST Council Meeting Highlights
- The GST rates on COVID-19 related equipments has been reduced from 12% to 5%
- The GST rates on sanitisers and temperature checking instruments have been reduced to 5% from 18%
- The GST on vaccines will remain at 5%
- GST on ambulances reduced to 12 %
- The centre will buy 75 % of the vaccine as announced and will pay its GST. However, 70% of income will be shared with States.
For a detailed update, please read: 44th GST Council Meeting Highlights
43th GST Council Meeting Highlights
- GST Amnesty Scheme was announced to grant relief to taxpayers by reducing late fee.
- Rationalization of late fees for all upcoming tax periods
- Covid 19 Relief Measures for Taxpayers
- Lower Interest Rate and waiver of Late Fees – (GST Notification 18/2021 and 19/2021)
- PMT-06 (for taxpayers opted for QRMP) and CMP 08 (Composite taxpayers)
- Extension of due dates of GST Returns – GST notification 16/2021, 17/2021, 25/2021, 26/2021 and 27/2021
For a detailed update, please read: 44th GST Council Meeting Highlights
42nd GST Council Meeting Highlights
- GST Council decides to extend the Compensation Cess levy beyond June 2022. Compensation of Rs. 20,000 crores to be released to States towards loss of revenue during 2020-21. Additionally, an amount of approx Rs. 25,000 CR towards IGST of 2017-18 to be released in the coming week.
- GST return filing changes including NIL GSTR 3B via SMS and form GSTR 2B.
- Due date of furnishing quarterly GSTR-1 by quarterly taxpayers was revised to the 13th of the month succeeding the quarter w.e.f. 01.1.2021
- QRMP – To reduce the compliance burden of small taxpayers having an aggregate annual turnover of less than ₹ 5 crores, GST Council approved quarterly return filing with monthly tax payment.
- HSN – A revised Harmonised System Nomenclature (HSN) System for Goods and Service Accounting Code (SAC) was decided to be introduced from 01.04.2021.
For a detailed update, please read: 42th GST Council Meeting Highlights
41st GST Council Meeting Highlights
The main agenda for the 41st GST Council Meeting was on the methods to compensate the states. The shortfall for the FY 2020-21 works out to be Rs 2,35,000 crore. Out of this, Rs 97,000 crore is the shortfall due to GST implementation, and the rest is considered as due to COVID-19.
The centre has given two options in the 41st GST Council Meeting to the states to meet the shortfall of the compensation cess. Here are the options:
- Option I: The centre can aid Rs 97,000 crore to states as borrowings, through a special window by the RBI. This money can be repaid after 5 years on the collection of cess along with paying a reasonable rate of interest.
- Option II: Option two is that the states can borrow Rs 2,35,000 crore directly from the RBI.
For a detailed update, please read: 41st GST Council Meeting Highlights
40th GST Council Meeting Highlights
- No late fees for taxpayers who have no tax liability but have not filed GST returns for tax-period July 2017 – Jan 2020.
- For taxpayers having tax liability, maximum late fee for non-filing of GSTR-3B returns for period Jul 2017 – Jan 2020 has been capped to ₹ 500 This will apply to all returns submitted during Jul 1, 2020 – Sep 30, 2020.
- For small taxpayers whose aggregate turnover is up to ₹5 crore, the rate of interest for late furnishing of GST returns for Feb, Mar and April 2020, beyond July 6, 2020, the rate of interest is being reduced from 18% to 9%.
- Small taxpayers will have to pay no interest for late furnishing of GST returns till July 6, 2020 post that reduced interest @9% will be applicable till September 30, 2020.
- For small taxpayers whose aggregate turnover is up to ₹ 5 crore are waived off late fees and interest if they file GSTR-3B for months of May, June and July 2020, by September 2020.
For a detailed update, please read: 40th GST Council Meeting Highlights
39th GST Council Meeting Highlights
- E-invoicing and the QR code was deferred to 1st October 2020.
- Certain class of registered persons (insurance company, banking company, financial institution, non-banking financial institution, GTA, passenger transportation service etc.) exempted from issuing e-invoices or capturing dynamic QR code;
- Taxpayers to continue the existing system of furnishing FORM GSTR-1 & FORM GSTR-3B till September, 2020
- Extension of the time to finalize e-Wallet scheme up to 31st March 2021
- Extension of the present exemptions from IGST and cess on the imports made under the AA/EPCG/EOU schemes up to 31.03.2021.
Decisions related to Annual Return
- Due date for GSTR-9 and 9C for FY 2018-19 has been pushed to 30th June 2020
- Relaxation to MSMEs from furnishing of Reconciliation Statement in FORM GSTR-9C, for the financial year 2018-19, for taxpayers having aggregate turnover below Rs. 5 crore
- Late fees not to be levied for delayed filing of the Annual return and the Reconciliation Statement for financial year 2017-18 and 2018-19 for taxpayers with aggregate turnover less than Rs. 2 crores
For a detailed update, please read: 39th GST Council Meeting Highlights
38th GST Council Meeting Highlights
- Provisional ITC Claim: The GST Council has decided that a restriction of 10% will be applicable on provisional ITC, if the taxpayer’s ITC data does not match with the vendor’s GSTR 1 data. Earlier the restriction was set to 20%. Read more on 20% provisional ITC rule here.
- Relaxing Requirements To Get Exemption On Long Term Lease: The GST Council decided to exempt GST payable on long term leases of industrial or financial infrastructure plot by an entity having 20 percent or more ownership of centre or state government. This became effective from 1st January 2020.
- Grievance Redressal: Grievance Redressal Committees constituted at state and zone level to address the grievances of taxpayers. The committee consists of CGST officers, SGST officers, representatives of trade and industry and other GST stakeholders like GST practitioners and GSTN etc.
For a detailed update, please read: 38th GST Council Meeting Highlights
37th GST Council Meeting Highlights
- Optional Annual Returns [FY 2017-18 and FY 2018-19]: Annual Return form (GSTR 9) has been made optional for taxpayers with an annual turnover below Rs 2 crores. Similarly, Annual Return for Composite Dealers (GSTR 9A) has been completely waived off for the given fiscal years. However, taxpayers with an annual turnover Rs 2 Crore and above will still be required to file their annual returns, along with GST Audit in form GSTR 9C.
- Services added under RCM: RCM on payment of GST on securities lending service under RCM at the merit rate of 18%. Also clarified that GST on securities lending service for period prior to RCM period shall be paid on forward charge basis. IGST shall be payable on supply of these services and in cases where CGST/SGST/UTGST have been paid, such taxpayers will not be required to pay tax again. RCM to Suppliers paying GST @ 5% on renting of vehicles, from registered person other than body corporate (LLP, proprietorship) when services provided to body corporate entities.
- GST Rate Revision: The council revised the rates for 13 GST goods and services
For a detailed update, please read: 37th GST Council Meeting Highlights
36th GST Council Meeting Highlights
- Electric Vehicle: The GST rate on all electric vehicles shall be reduced from 12% to 5%.
The GST rate on charger or charging stations for Electric vehicles shall be reduced from 18% to 5%.
Hiring of electric buses (of carrying capacity of more than 12 passengers) by local authorities shall be exempted from GST.
- Composition Scheme: The GST council extended the time period for a taxpayer to opt-in for composition scheme from 31st July 2019 to 30th September 2019. However, such extension is applicable only for the service providers notified under notification No. 2/2019-Central tax (rate) dated 07.03.2019 for a special Composition Scheme. Furthermore, the due date for paying GST in CMP-08 (for the quarter April-June 2019) for all the composition dealers has been extended from July 31, 2019 to 31 August 2019.For a detailed update, please read: 36th GST Council Meeting Highlights
35th GST Council Meeting Highlights
- GSTR 9 and 9C due date extended by 2 months until 31st August 2019.
- E-invoicing: In order to curb GST tax evasion, the finance minister approves the proposal of E-invoices.
- NAA Tenure Extension: The National Anti-Profiteering Authority which was introduced to ensure passage of tax benefits to the consumers was about to finish its tenure in 5 months. As the profiteering complaints are yet to stop, the FM has given a 2 year extension to NAA in the 35th GST council meeting.
- Other important announcements from the meeting
- Approves setting up tribunals in 26 states.
- GST rate on electric charger cut to 12% from 18%
For a detailed update, please read: 35th GST Council Meeting Highlights
34th GST Council Meeting Highlights
- Conditions for the new tax rates: The new tax rates of 1% (on construction of affordable) and 5% (on other than affordable houses) shall be available subject to following conditions:
- Input tax credit shall not be available
- 80% of inputs and input services (other than capital goods, TDR/ JDA, FSI, long term lease (premiums) shall be purchased from registered persons.
- On shortfall of purchases from 80%, tax shall be paid by the builder @ 18% on RCM basis.
- Tax on cement purchased from an unregistered person shall be paid @ 28% under RCM and on capital goods under RCM at applicable rates.
- Amendment to ITC rules: ITC rules shall be amended to bring greater clarity on monthly and final determination of ITC and reversal thereof in real estate projects. The change would clearly provide procedure for availing input tax credit in relation to commercial units as such units would continue to be eligible for input tax credit in a mixed project. There were several other announcements and changes. For a detailed update, please read: 34th GST Council Meeting Highlights
33rd GST Council Meeting Highlights
- The residential property with 90 sq. meters carpet area in metro cities and 60 sq. meters in non-metro cities priced at Rs. 45 lakh or below considered ‘affordable’ and taxed at 1 percent.
- Under-construction properties priced over Rs. 45 lakh to be taxed at 5 percent.
- Input tax credit not allowed in both the cases.
- The move will come into effect from April 1, 2019.
- Bengaluru, Chennai, Delhi NCR, Hyderabad, Kolkata, and Mumbai MMR region are considered metro cities.
For a detailed update, please read: 33rd GST Council Meeting Highlights
32nd GST Council Meeting Highlights
Decisions around MSME Relief:
- Higher Exemption Threshold Limit for Supplier of Goods: Basic exemption limit for suppliers of goods will be increased from Rs 20 lakhs to Rs 40 lakhs. However, this limit remains Rs 20 lakhs for suppliers of services. For the special category States, the limit for registration is currently at Rs 10 lakhs. This limit in case of supply of goods is increased up to Rs 20 lakhs and such States have been given an option to either choose Rs 40 lakhs or Rs 20 lakhs threshold limit in a week’s time. Operational from the 1ST of April, 2019.
- Composition Scheme for Services: A Composition Scheme shall be made available for Suppliers of Services (or Mixed Suppliers) with a Tax Rate of 6% (3% CGST +3% SGST) having an Annual Turnover in the preceding Financial Year up to Rs 50 lakhs. The said Scheme Shall be applicable to both Service Providers as well as Suppliers of Goods and Services, who are not eligible for the presently available Composition Scheme for Goods. They would be liable to file one Annual Return with Quarterly Payment of Taxes (along with a Simple Declaration). Operational from the 1ST of April, 2019.
- Increase in Turnover Limit for the existing Composition Scheme: The limit of Annual Turnover in the preceding Financial Year for availing Composition Scheme for Goods shall be increased to Rs 1.5 crore. Special category States would decide, within one week, about the Composition Limit in their respective States. Operational from the 1ST of April, 2019.
- Compliance Simplification: The compliance under Composition Scheme shall be simplified as now they would need to file one Annual Return but Payment of Taxes would remain Quarterly (along with a simple declaration). Operational from 1ST April 2019.
- Free Accounting and Billing Software: shall be provided to Small Taxpayers by GSTN.
For a detailed update, please read: 32nd GST Council Meeting Highlights
31st GST Council Meeting Highlights
- There would be a single cash ledger for each tax head. The modalities for implementation would be finalized in consultation with GSTN and the Accounting authorities.
- The new return filing system shall be introduced on a trial basis from 01.04.2019 and on a mandatory basis from 01.07.2019.
- The due date for furnishing the annual returns in FORM GSTR-9, FORM GSTR-9A and reconciliation statement in FORM GSTR-9C for the Financial Year 2017 – 2018 shall be further extended till 30.06.2019.
- The following clarificatory changes, inter-alia, shall be carried out in the formats/instructions according to which the annual return/reconciliation statement is to be submitted by the taxpayers
- Amendment of headings in the forms to specify that the return in FORM GSTR-9 & FORM GSTR-9A would be in respect of supplies etc. ‘made during the year’ and not ‘as declared in returns filed during the year’
- All returns in FORM GSTR-1 & FORM GSTR-3B have to be filed before filing of FORM GSTR-9&FORM GSTR-9C
- All returns in FORM GSTR-4 have to be filed before filing of FORM GSTR-9A;
- HSN code may be declared only for those inward supplies whose value independently accounts for 10% or more of the total value of inward supplies
- Additional payments, if any, required to be paid can be done through FORM GST DRC-03 only in cash;
- ITC cannot be availed through FORM GSTR-9 and FORM GSTR-9C
- All invoices pertaining to the previous FY (irrespective of the month in which such invoice is reported in FORM GSTR-1) would be auto-populated in Table 8A of FORM GSTR-9;
- The value of “non-GST supply” shall also include the value of “no supply” and may be reported in Table 5D, 5E and 5F of FORM GSTR-9
For a detailed update, please read: 31st GST Council Meeting Highlights
30th GST Council Meeting Highlights
The 30th GST Council Meeting did not see any major changes or announcements. Here are the highlights of the decisions taken.
- No GST rate change for any product or service
- No finalization was made on Petrol and Diesel (Whether or not to include them under GST)
- Proposal of State of Kerala for the imposition of Cess on SGST for rehabilitation and flood-affected works
- 1% Pan-India tax on commodities was discussed
29th GST Council Meeting Highlights
- To address the issues related to MSMEs, a group of ministers were made in-charge
- This group to work in alignment with the law and fitment committee to address the concerns of this sector on GST compliances and procedures related to GST filings.
- Discussions to Improve outreach of Digital Payments facilities among Indians
28th GST Council Meeting Highlights
Scope and process for GST returns
- There will be one monthly return to be filed by taxpayers, consisting of two sections
- Details pertaining to outward supplies
- Details for availing Input Tax Credit (ITC). ITC claim will be based on the invoices uploaded by the supplier
- The principles as explained in the previous council meeting related to uploading of invoices by the supplier on a continuous basis and locking of invoices by the receiver for claiming ITC will be implemented. It is anticipated that this process could result in auto-population of the monthly return format to a large extent and thus ease the return filing process. As put forward by the Council, the process will be ‘UPLOAD – LOCK – PAY’ for most of the taxpayers.
Options for small taxpayers: For making the return filing further easy for small businesses, who form a majority of the registered taxpayers base, the filing frequency, format and methods are relaxed.
- Taxpayers with revenue below 5 crore will have an option to file on a quarterly basis. The payment of tax, however, would be monthly.
- Nil returns can be filed through SMS.
- Sahaj and Sugam, the returns for small taxpayers, will have lesser information from regular returns. The two forms would be catering to taxpayers who have only B2C transactions and the taxpayers who also supply to other registered taxpayers.
For a detailed update, please read: 28th GST Council Meeting Highlights
27th GST Council Meeting Highlights
- The existing returns i.e. GSTR 1 and GSTR 3B will continue for the upcoming 6 months. In this period, GSTN will be designing and developing the IT system for the new returns.
- Taxpayers to follow the new process. The B2B sales invoices will be uploaded on the GST system. Amount of ITC will be declared by the taxpayer based on self-computation. While the provisional claim of ITC will be allowed during the transition period, information will be made available to the taxpayer about differences, if any.
For a detailed update, please read: 27th GST Council Meeting Highlights
26th GST Council Meeting Highlights
- E-way Bill made mandatory for consignments having values INR 50,000 or more. As per the update, the value of exempt goods will not be considered while deriving the value of consignment.
- For transporters who are carrying multiple consignments in a single conveyance and the value of every individual consignment is less than INR 50,000, there is no requirement to create an Eway bill even if the total value of goods in the conveyance is exceeding INR 50,000.
- The Part B of Eway Bill includes the transportation details such as vehicle number in case of road, rail receipt number in case of railways etc. The Part B information needs to be provided before commencing the movement of goods. However, if the mode of transport is rail, air or ship, then the Part B of E-way Bill can be updated either before or after the commencement of movement of goods.
- The erstwhile exemption limit of 10 km for generation of Eway Bill has now been increased to 50km. The movement from place of consignor to that of transporter if within the state and within 50km, there is no requirement to fill Part B of Eway Bill.
For a detailed update, please read: 26th GST Council Meeting Highlights
11th GST Council Meeting Highlights
- Single GST Registration, Single GST Return.
- A business entity with an annual turnover of up to Rs. 20 lakhs would not be required to register with GST.
- A business entity with turnover up to Rs. 50 lakhs can avail the benefit of a composition scheme
- Input Tax Credit Permissibility and ITC Cross Utilization
- Exporter Capital Lock-in prevention
- Flow of ITC in Service Sector
- Single Administrative Interface
- Exemption to Agriculturists
- To provide certainty in tax matters, a provision is made for an Advance Ruling Authority and Appellate mechanism
- Transitional Provisions under GST and Tax payment in installment
- Anti-profiteering provision
For a detailed update, please read: 11th GST Council Meeting Highlights