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स्रोत: हिंदुस्तान

सामान की एडवांस बुकिंग परे जीएसटी नहीं देना होगा |

Refund of IGST paid on export of goods

The Central Board of Excise & Customs, Ministry of Finance, have issued INSTRUCTION NO.15/2017-CUSTOMS dated 9th October, 2017.

which explains that;
Rule 96 of the CGST Rules 2017 deals with refund of Integrated Tax paid on goods exported out of India.

It provides that the shipping bill filed by an exporter shall be deemed to be an application for refund of integrated tax paid on the goods exported out of India once export general manifest (EGM) and valid return in Form GSTR-3 or Form GSTR-3B, as the case may be has been filed.

Once these conditions are met, the Customs System shall process the claim for refund and an amount equal to the integrated tax paid in respect of each shipping bill or bill of export shall be electronically credited to the bank account of the applicant mentioned in his registration particulars and as intimated to the Customs authorities.

The Committee on Exports setup by the GST Council has recommended that IGST refunds for exports made in July 2017 must start by 10.10.2017.

This recommendation has been endorsed by GST Council in its meeting on 06-10-2017. Necessary background work is being done by the Directorate General of Systems, GSTN and Controller General of Accounts (PFMS). In order to ensure that refunds start smoothly, following guidelines are issued for the field formations.

No extension of last date for filing GSTR-1 for July, 2017

source: sns124.com / 9th October, 2017 

The last date for filing GSTR-1 for the month of July, 2017 is 10th October, 2017. An extension of two months has already been given. There will be no further extension given to taxpayers for filing their GSTR-1 return for July. Taxpayers who have not yet filed their GSTR-1 for July are advised to do so immediately.

2. Once a taxpayer files GSTR-1 by 10th October, the corresponding entries in GSTR-2A of his buyer shall get auto populated. The buyer shall finalize his GSTR-2 after making modifications (additions, corrections or deletions), if required, in GSTR-2A. The Input Tax Credit (ITC) shall be availed by the buyer based on his GSTR-2. If a taxpayer does not file GSTR-1 by 10th of October, then his buyer may face difficulty in availing ITC of the tax paid on his supplies. It is therefore advised that all suppliers of goods or services, especially B2B suppliers, furnish their outward supply details in GSTR-1 by the due date so that no difficulty is faced by their buyers in availing ITC and the return cycle can be completed in due course. 

Recommendations made by the GST Council in the 22nd meeting at New Delhi on 6th October, 2017

Recommendations made by the GST Council in the 22nd meeting at New Delhi on 6th October, 2017

 GST package for Small Units 

The GST Council, in its 22nd meeting held at New Delhi on 6th October 2017, has recommended the following facilitative changes to ease the burden of compliance on small and medium businesses:

 Composition Scheme 

1. The composition scheme shall be made available to taxpayers having annual aggregate turnover of up to Rs. 1 crore as compared to the current turnover threshold of Rs. 75 lacs. This threshold of turnover for special category States, except Jammu & Kashmir and Uttarakhand, shall be increased to Rs. 75 lacs from Rs. 50 lacs. The turnover threshold for Jammu & Kashmir and Uttarakhand shall be Rs. 1 crore. The facility of availing composition under the increased threshold shall be available to both migrated and new taxpayers up to 31.03.2018. The option once exercised shall become operational from the first day of the month immediately succeeding the month in which the option to avail the composition scheme is exercised. New entrants to this scheme shall have to file the return in FORM GSTR-4 only for that portion of the quarter from when the scheme becomes operational and shall file returns as a normal taxpayer for the preceding tax period. The increase in the turnover threshold will make it possible for greater number of taxpayers to avail the benefit of easier compliance under the composition scheme and is expected to greatly benefit the MSME sector.

2. Persons who are otherwise eligible for composition scheme but are providing any exempt service (such as extending deposits to banks for which interest is being received) were being considered ineligible for the said scheme. It has been decided that such persons who are otherwise eligible for availing the composition scheme and are providing any exempt service, shall be eligible for the composition scheme.

3. A Group of Ministers (GoM) shall be constituted to examine measures to make the composition scheme more attractive.

Relief for Small and Medium Enterprises 

4. Presently, anyone making inter-state taxable supplies, except inter-State job worker, is compulsorily required to register, irrespective of turnover. It has now been decided to exempt those service providers whose annual aggregate turnover is less than Rs. 20 lacs (Rs. 10 lacs in special category states except J & K) from obtaining registration even if they are making inter-State taxable supplies of services. This measure is expected to significantly reduce the compliance cost of small service providers.

5. To facilitate the ease of payment and return filing for small and medium businesses with annual aggregate turnover up to Rs. 1.5 crores, it has been decided that such taxpayers shall be required to file quarterly returns in FORM GSTR-1,2 & 3 and pay taxes only on a quarterly basis, starting from the third quarter of this financial year i.e. October-December, 2017. The registered buyers from such small taxpayers would be eligible to avail ITC on a monthly basis. The due dates for filing the quarterly returns for such taxpayers shall be announced in due course. Meanwhile, all taxpayers will be required to file FORM GSTR-3B on a monthly basis till December, 2017. All taxpayers are also required to file FORM GSTR-1, 2 & 3 for the months of July, August and September, 2017. Due dates for filing the returns for the month of July, 2017 have already been announced. The due dates for the months of August and September, 2017 will be announced in due course.

6. The reverse charge mechanism under sub-section (4) of section 9 of the CGST Act, 2017 and under subsection (4) of section 5 of the IGST Act, 2017 shall be suspended till 31.03.2018 and will be reviewed by a committee of experts. This will benefit small businesses and substantially reduce compliance costs.

7. The requirement to pay GST on advances received is also proving to be burdensome for small dealers and manufacturers. In order to mitigate their inconvenience on this account, it has been decided that taxpayers having annual aggregate turnover up to Rs. 1.5 crores shall not be required to pay GST at the time of receipt of advances on account of supply of goods. The GST on such supplies shall be payable only when the supply of goods is made.

8. It has come to light that Goods Transport Agencies (GTAs) are not willing to provide services to unregistered persons. In order to remove the hardship being faced by small unregistered businesses on this account, the services provided by a GTA to an unregistered person shall be exempted from GST.

Other Facilitation Measures 

9. After assessing the readiness of the trade, industry and Government departments, it has been decided that registration and operationalization of TDS/TCS provisions shall be postponed till 31.03.2018.

10. The e-way bill system shall be introduced in a staggered manner with effect from 01.01.2018 and shall be rolled out nationwide with effect from 01.04.2018. This is in order to give trade and industry more time to acclimatize itself with the GST regime.

11. The last date for filing the return in FORM GSTR-4 by a taxpayer under composition scheme for the quarter July-September, 2017 shall be extended to 15.11.2017. Also, the last date for filing the return in FORM GSTR-6 by an input service distributor for the months of July, August and September, 2017 shall be extended to 15.11.2017.

12. Invoice Rules are being modified to provide relief to certain classes of registered persons.

Due dates revised for Filing of GST returns

The GST Council, in its 21^st meeting held at Hyderabad on 9^th September 2017, has recommended the following measures to facilitate taxpayers:

a)      In view of the difficulties being faced by taxpayers in filing returns, the following revised schedule has been approved:

Sl. No.	Details / Return	Tax Period	Revised due date
1	GSTR-1	July, 2017	10-Oct-17
For registered persons with aggregate turnover of more than Rs. 100 crores, the due date shall be 3rdOctober 2017
2	GSTR-2	July, 2017	31-Oct-17
3	GSTR-3	July, 2017	10-Nov-17
4	GSTR-4	July-September, 2017	18-Oct-17 (no change)
Table-4 under GSTR-4 not to be filled for the quarter July-September 2017. Requirement of filing GSTR-4A for this quarter is dispensed with.
5	GSTR-6	July, 2017	13-Oct-17

Due dates for filing of the above mentioned returns for subsequent periods shall be notified at a later date.

b)      GSTR-3B will continue to be filed for the months of August to December, 2017.

c)      A registered person (whether migrated or new registrant), who could not opt for composition scheme, shall be given the option to avail composition till 30^th September 2017 and such registered person shall be permitted to avail the benefit of composition scheme with effect from 1^st October, 2017.

d)     Presently, any person making inter-state taxable supplies is not eligible for threshold exemption of Rs. 20 lacs (Rs. 10 lacs in special category states except J & K) and is liable for registration. It has been decided to allow an exemption from registration to persons making inter-State taxable supplies of handicraft goods upto aggregate turnover of Rs. 20 lacs as long as the person has a Permanent Account Number (PAN) and the goods move under the cover of an e-way bill, irrespective of the value of the consignment.

e)      Presently, a job worker making inter-State taxable supply of job work service is not eligible for threshold exemption of Rs. 20 lacs (Rs. 10 lacs in special category states except J & K) and is liable for registration.  It has been decided to exempt those job workers from obtaining registration who are making inter-State taxable supply of job work service to a registered person as long as the goods move under the cover of an e-way bill, irrespective of the value of the consignment. This exemption will not be available to job work in relation to jewellery, goldsmiths’ and silversmiths’ wares as covered under Chapter 71 which do not require e-way bill.

f)       FORM GST TRAN-1 can be revised once.

g)      The due date for submission of FORM GST TRAN-1 has been extended by one month i.e. 31^st October, 2017.

h)      The registration for persons liable to deduct tax at source (TDS) and collect tax at source (TCS) will commence from 18^th September 2017. However, the date from which TDS and TCS will be deducted or collected will be notified by the Council later.

2.         The GST Council has decided to set up a committee consisting of officers from both the Centre and the States under the chairmanship of the Revenue Secretary to examine the issues related to exports.

3.         The GST Council has also decided to constitute a Group of Ministers to monitor and resolve the IT challenges faced during GST implementation.

SOURCE: Press Information Bureau: 09-September-2017

Late fee waived for all tax-payers who could not file the GSTR 3B for the month of July 2017

The Goods and Services Tax (GST) tax was introduced on 1^st of July 2017.  The last date for payment of GST for the month of July 2017 was 25th August 2017.  Payment of GST is complete only when amount of tax payable is debited from electronic cash / credit ledger.

            Now late fee for all taxpayers who could not file GSTR 3B for the month of July 2017 has been waived, but not the interest on late payment of Tax liability.

            GSTR 1 is to be filed by all taxpayers by 5th of September 2017 and GSTR 2 and GSTR 3 to be filed by all taxpayers by 10th and 15th of September 2017 respectively.

            Taxpayers who have committed errors in GSTR 3B will be able to put the correct details in GSTR 1-2-3. However, interest will be leviable from all taxpayers who have not discharged their complete Tax liability for July 2017 by 25-08-2017.

            Furthermore, vide Circular dated 01-09-2017, procedure for systems based reconciliation of GSTR 1-2 with GSTR 3B has been clarified.

Click here for Circular dated 01-09-2017

source: Press Information Bureau: 02-September-2017

Benefits of the reduced rates/tax rebate to the consumers post GST

Benefits of the reduced rates/tax rebate to the consumers post GST

The GST Council comprising the representatives of Central and State Government recommended the GST rates for goods and services, interalia taking into account the pre-GST indirect taxes incidence on goods and service. The GST rates on goods have since been notified. With the GST rates so notified the tax incidence on items like food grain, milk, egg, sugar, vegetable edible oils, spices in GST regime is lower than the tax incidence in the pre-GST regime.

GST tax rates have been fixed with the objective of maintaining revenue-neutrality in the post-GST regime.

Section 171 of the Central Goods and Services Act, 2017 provides for Anti-Profiteering measure according to which any reduction in rate of tax on any supply of goods or services or the benefit of input tax credit shall be passed on to the recipient by way of commensurate reduction in prices and the Central Government is in the process of constituting an Authority to examine the same. Many business entities have reduced the prices of their goods and services in view of lower GST rates under the GST regime. They have been publishing these revised rates in leading newspapers from time to time for consumer benefit.

This was stated by Shri Santosh Kumar Gangwar, Minister of State for Finance in written reply to a question in Lok Sabha today. 

source: Press Information Bureau: July 28, 2017

Features of GST

Features of GST

Goods and Services Tax (GST) is intended to bring transparency and accountability in business transactions along with the ease of doing business and rationalization in tax rates and will not pave the way for financialization of the country.

The foremost benefit of GST is to remove hurdles in inter-State transactions resulting in the setting up of a common market. This make ‘one nation, one tax and one market’ true in the country.Further, in case of inter-State supply, only integrated tax is to be levied while in intra-State supplies, central tax and State tax or Union territory tax is to be levied. Thus, the plethora of taxes being levied by the Centre and the States in the erstwhile regime has been replaced by simpler and more efficient taxation system.

GST will promote business and development by making the taxation structure easy and by eliminating the numerous taxes. The GST laws have been framed in such a manner that a multitude of taxes have been replaced by one tax. The details of the taxes subsumed under GST are as under.

(A) Taxes related to Centre:

i. Central Excise duty
ii. Duties of Excise (Medicinal and Toilet Preparations)
iii. Additional Duties of Excise (Goods of Special Importance)
iv. Additional Duties of Excise (Textiles and Textile Products)
v. Additional Duties of Customs (commonly known as CVD)
vi. Special Additional Duty of Customs (SAD)
vii. Service Tax
viii. Central Surcharges and Cesses so far as they relate to supply of goods or services.
(B) Taxes related to State 

i. State VAT
ii. Central Sales Tax
iii. Luxury Tax
iv. Octroi and Entry Tax (all forms)
v. Entertainment and Amusement Tax (except when levied by the local bodies)
vi. Taxes on advertisements
vii. Purchase Tax
viii. Taxes on lotteries, betting and gambling
ix. State Surcharges and Cesses so far as they relate to supply of goods or services.
GST will improve productivity and easiness of business as the entire nation has been converted into a single market by removal of hurdles to inter-State trade. Further, uniform tax rates along with reduction in the cascading effect of taxation and increased input tax credit utilization in GST would immensely benefit the nation. There is automation of all major business processes viz., registration, payment of tax, return filing, etc.

This was stated by Shri Santosh Kumar Gangwar, Minister of State for Finance in written reply to a question in Lok Sabha today. 

source: Press Information Bureau : July 28, 2017

वस्‍तु एवं सेवाकर की विशेषताएं

वस्‍तु एवं सेवाकर की विशेषताएं  

      वस्‍तु एवं सेवाकर (जीएसटी)  का उद्देश्‍य व्‍यापारिक लेनदेन में पारदर्शिता लाना और जवाबदेही तय करना है। इसके अलावा जीएसटी से व्‍यापार करने में आसानी होगी तथा टैक्‍स की दरें तर्कसंगत होंगी, जिससे देश की वित्‍तीय स्थिति को सही दिशा मिलेगी।

      जीएसटी का सबसे पहला लाभ यह है कि इससे राज्‍यों के बीच होने वाले लेनदेन की बाधाएं दूर हो जाएंगी तथा एक साझा बाजार की रचना होगी। देश में ‘एक राष्‍ट्र, एक कर और एक बाजार’ की अवधारणा आगे बढ़ेगी। राज्‍यों के बीच आपूर्ति के संबंध में केवल एकीकृत कर प्रणाली काम करेगी, जबकि राज्‍यों के भीतर होने वाली आपूर्ति के संबंध में केन्‍द्रीय कर और राज्‍यकर लागू होंगे। इस तरह पिछली प्रणाली के स्‍थान पर अब केन्‍द्र और राज्‍यों में आसान तथा कारगर कर प्रणाली काम करेगी।

      कराधान ढांचे को आसान बनाकर जीएसटी व्‍यापार और विकास को प्रोत्‍साहन देगा, क्‍योंकि असंख्‍य कर समाप्‍त हो जायेंगे। जीएसटी कानूनों को इस तरह बनाया गया है कि विभिन्‍न प्रकार के टैक्‍सों के स्‍थान पर केवल एक ही टैक्‍स लागू हो। जीएसटी के अन्‍तर्गत निम्‍नलिखित टैक्‍स समाविष्‍ट कर दिए गए हैं:-

(अ) केन्‍द्र संबंधी कर:

1. केन्‍द्रीय उत्‍पाद शुल्‍क
2. उत्‍पाद शुल्‍क (औषधि और शौचालय निर्माण)
3. अतिरिक्‍त उत्‍पाद शुल्‍क (विशेष महत्‍व के सामान)
4. अतिरिक्‍त शुल्‍क (कपड़ा और कपड़ा उत्‍पाद)
5. अतिरिक्‍त सीमा शुल्‍क (आमतौर पर जिसे सीवीडी के नाम से जाना जाता है)
6. विशेष अतिरिक्‍त सीमा शुल्‍क (एसएडी)
7. सेवाकर
8. केन्‍द्रीय सरकार और उपकर, सामान या सेवा आपूर्ति के संबंध में।

(ब)  राज्‍य संबंधी कर:

1. राज्‍य वैट
2. केन्‍द्रीय बिक्री कर
3. विलासिता कर
4. चुंगी और प्रवेश कर (सभी प्रकार के)
5. मनोरंजन एवं मनोविनोद कर (स्‍थानीय निकायों द्वारा लागू होने के अतिरिक्‍त)
6. विज्ञापनों पर कर
7. खरीद कर
8. लॉटरी और जुए पर कर
9. राज्‍य सरकार और उपकर, सामान या सेवा आपूर्ति के संबंध में।

      जीएसटी से उत्‍पादकता में सुधार होगा और व्‍यापार करने में आसानी होगी, क्‍योंकि इसके तहत पूरा राष्‍ट्र एकल बाजार में तब्‍दील हो जाएगा। राज्‍यों के बीच होने वाले व्‍यापार की बाधाएं दूर हो जाएंगी। इसके अलावा कराधान का दुष्‍प्रभाव कम होगा और कर का दायरा बढ़ जाएगा, जिससे देश को बहुत फायदा मिलेगा।

      यह जानकारी आज लोकसभा में वित्‍त राज्‍यमंत्री श्री संतोष कुमार गंगवार ने एक प्रश्‍न के लिखित उत्‍तर में दी।

source: Press Information Bureau: July 28, 2017

Discussions with Stakeholders on GST

source; PIB: July 19, 2017

Ministry of Commerce & Industry in Government of India has set up a facilitation cell each in both Department of Commerce and Department of Industry to reply to the queries of the stakeholders on GST. 

In addition to this, a series of meetings and workshops have been organized to review the preparedness for implementation of GST, create awareness about it and to discuss the operational issues pertaining to GST with the stakeholders. 

This inter-alia includes meetings with representations of Industry Associations such as Confederation of Indian Industry (CII), the Associated Chambers of Commerce & Industry of India (ASSOCHAM), PHD Chamber of Commerce & Industry, representatives of industry associations of special category states of Jammu & Kashmir, Himachal Pradesh and Uttarakhand, representatives of Automobile Industry, Cement Industry, Leather Industry, Rubber Industry, Tyre Manufactures, Paper Industry etc. 

Discussions have also been held with the Service Exporters, representatives of Hotel and Hospitality industry, Logistics Services, Council for Leather Exporters etc. to discuss the issues pertaining to rollout of GST and its implications on them. 

In addition to the meetings held in States and Union Territories, seminars, workshops and meetings have also been organized in the Special Economic Zones to discuss the GST related issues of units located therein. 

This information was given by the Commerce and Industry Minister Smt. Nirmala Sitharaman in a written reply in Rajya Sabha today 

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Organized traders and unorganized sellers in Textile Sector have not been affected by the Goods and Services Tax (GST).

source; PIB: July 18, 2017

In reply to a Starred Question in Rajya Sabha today, the Union Minister for Finance, Defence and Corporate Affairs, Shri Arun Jaitley said that the organized traders and unorganized sellers in Textile Sector have not been affected by the Goods and Services Tax (GST).

Shri Jaitley said that the GST rate structure for the textile sector was discussed in detail in the GST Council Meeting held on 3rd June, 2017, wherein the Council recommended the detailed rate structure for the textile sector. Accordingly, the GST rates for the textile sector have been notified as under:

S. No.	Type of fibre/filament	GST rate
		Fibre	Yarn	Fabrics*	Garments and made ups**
1.	Silk	Nil	5%	5%	5% / 12%
2.	Wool	Nil	5%	5%	5% / 12%
3.	Cotton	5%	5%	5%	5% / 12%
4.	Other vegetable fibres	Nil / 5%	5%	5%	5% / 12%
5.	Manmade fibres / filaments	18%	18%	5%	5% / 12%

* - 5% GST rate with no refund of unutilized input tax credit.

** - (i) 5% GST rate for garments / made ups of sale value not exceeding Rs.1000 per piece.

       (ii) 12% GST rate for garments / made ups of sale value exceeding Rs.1000 per piece.

Thus, the GST rate structure for the Textiles Sector enables ease of classification and determination of rate.

The main demand of the textile traders is not to put any tax on fabrics. However, the same cannot be accepted because of the following reasons:

·         Nil GST on fabrics will break the input tax credit chain and then the garments / made ups manufacturers will not be able to get the credit of tax on previous stages

·         Nil GST on fabrics will result in zero rating of imported fabrics, while domestic fabrics will continue to bear the burden of input taxes.

·         Generally, the GST rates are equal or lower than the pre-GST tax incidence. And therefore, the price of fabrics is not likely to go up.

It is not correct to say that textiles sector was never taxed in independent India. In fact, during 2003-04, the entire textiles sector was subjected to central excise duty. Necessary steps have been taken to facilitate taxpayers to take GST registration. GST Sewa Kendras have been set-up in various centres to handhold the taxpayers and to provide all necessary guidance regarding GST compliance.

This was stated by Shri Arun Jaitley, Union Minister for Finance, Defence and Corporate Affairs in a written reply to a Starred Question in Rajya Sabha today.

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GST : to migrate from a complicated and multi tax system to a simpler tax system

source; PIB: July 18, 2017

The tax rates on goods and services have been fixed taking into consideration, inter alia, the total indirect tax incidence in pre- GST regime, including cascading of taxes. The GST rates so notified are lower than the pre-GST tax incidence on most of the items of mass consumption, such as cereals, pulses, milk, tea, vegetable edible oils, sugar, toothpaste, hair oil, soap, footwear, Childrens' picture, drawing or coloring books, etc. 

In addition, the objective of GST was to migrate from a complicated and multi tax system to a simpler tax system. The GST thus, is a much simpler tax regime as compared to tax regime it has replaced. 

In fact, GST has replaced several taxes which were being levied and collected by the Centre, including Central Excise Duty; Duties of Excise (Medicinal and Toilet Preparations); Additional Duties of Excise (Goods of Special Importance); Additional Duties of Excise (Textiles and Textile Products); Additional Duties of Customs (commonly known as CVD); Special Additional Duty of Customs (SAD); and Service Tax. 

In addition, a number of State taxes have also been subsumed in GST, including State VAT; Central Sales Tax; Purchase Tax; Luxury Tax; Entry Tax (All forms); Entertainment Tax (except those levied by the local bodies); Taxes on advertisements; Taxes on lotteries, betting and gambling. Besides, a number of cesses have also been abolished vide the Taxation Laws Amendment Act, 2017. GST has only five rational rates (0%, 5%, 12%, 18%, and 28%) as against multiple excise duty rates, rate of cesses and surcharges and multiple rates of VAT (varying across the states in many cases). 

Therefore, overall the GST is much simpler to earlier tax regime it has replaced.

This was stated by Shri Santosh Kumar Gangwar, Minister of State for Finance in written reply to a question in Rajya Sabha today.

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GST rates so notified are lower than the pre-GST tax incidence

source; Press Information Bureau: July 18, 2017

GST rates so notified are lower than the pre-GST tax incidence on most of the items of mass consumption such as cereals, pulses, milk, tea, vegetable edible oils, sugar, toothpaste, hair oil, soap, footwear, Childrens' picture, drawing or colouring books, etc. 

The GST rates on supply of goods and services have been notified based on the recommendations of the GST Council. The GST rates on goods and services have been fixed taking into consideration, inter alia, the total indirect tax incidence in pre-GST regime, including cascading of taxes. The GST rates so notified are lower than the pre-GST tax incidence on most of the items of mass consumption such as cereals, pulses, milk, tea, vegetable edible oils, sugar, toothpaste, hair oil, soap, footwear, Childrens' picture, drawing or colouring books, etc.

 

Further, any supplier in the State or Union territory, other than special category States, from where he makes a taxable supply of goods or services or both, whose aggregate turnover in a financial year does not exceed Rs.20 lakh [Rs.10 lakh in the case of special category States] is not liable to be registered under the Central Goods and Services Tax Act, 2017. Also, an eligible registered person in the State or Union territory, other than special category States [except Uttarakhand], whose aggregate turnover in the preceding financial year did not exceed Rs.75 lakh [Rs.50 lakh in the case of special category States other than Uttarakhand], can avail of the Composition Scheme under GST.

 

This was stated by Shri Santosh Kumar Gangwar, Minister of State for Finance in written reply to a question in Rajya Sabha today.

 

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Government clarifies that accommodation in any hotel,

source; Press Information Bureau: July 18, 2017

Government clarifies that accommodation in any hotel, including 5-star hotels, having a declared tariff of a unit of accommodation of less than INR 7500 per unit per day, will attract GST @ 18% ; Star rating of hotels is, therefore, irrelevant for determining the applicable rate of GST. 

Reports have been received expressing doubts whether 5-star Hotels are liable to pay GST @ 28% irrespective of the declared tariff of a unit of accommodation.

In this context, it is hereby clarified that accommodation in any hotel, including 5-star hotels, having a declared tariff of a unit of accommodation of less than INR 7500 per unit per day, will attract GST @ 18%. Star rating of hotels is, therefore, irrelevant for determining the applicable rate of GST.

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GST exemption for products used by differently abled people

source; Press Information Bureau: July 18, 2017

Specified assistive devices, rehabilitation aids and other goods for differently abled people attract the lowest (non-Nil) GST rate of 5%. Most of the inputs for such goods attract 18% GST. Nil GST on any goods zero rates inputs, while domestic goods continue to bear input taxes. Further, for any goods which attract GST rate (other than Nil) which is lower than the inputs for such goods, the Central Goods and Services Tax Act, 2017 (GST law) provides for refund of accumulated input tax credit. Thus, 5% GST on assistive devices, rehabilitation aids, their manufacturers would enable their domestic manufacturers to claim refund of any accumulated Input Tax Credit. That being so, the 5% concessional GST rate on these devices/equipment would result in reduction of the cost of domestically manufactured goods, as compared to the pre-GST regime.

As against that, if these devices/equipments are exempted from GST, then while imports of such devices/equipments would be zero rated, domestically manufactured such devices/equipments will continue to bear the burden of input taxes, increasing their cost and resulting in negative protection for the domestic value addition.

This was stated by Shri Santosh Kumar Gangwar, Minister of State for Finance in written reply to a question in Rajya Sabha today.

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Increase in the Compensation Cess rate on cigarettes

source; Press Information Bureau: 17-July-2017 09:36 IST

Increase in the Compensation Cess rate on cigarettes to make the total tax incidence on cigarettes in GST regime at par with the total tax incidence in pre-GST regime.

                In pursuance of the recommendations of the GST Council in its 14^th Meeting held on 18.05.2017 and 19.05.2017, the Compensation Cess rates under Section 8 (2) of the Goods and Services Tax (Compensation to States) Act, 2017, was notified vide notification No.1/2017-Compensation Cess (Rate), dated 28.06.2017 on Intra-State or Inter-State supply of the specified goods, including cigarettes.

            In respect of cigarettes, the Fitment Committee had recommended that in line with the weighted average VAT rate [28.7%], the GST rate on cigarettes may be kept at 28%. In addition, Compensation Cess may be levied on cigarettes at rates equal to 1.05 times the Specific Excise Duty Rates [net of NCCD]. However, this method of calibrating the Compensation Cess did not take into consideration the cascading of taxes [that is in earlier regime VAT being charged on value inclusive of the excise duty]. As a result, the total tax incidence on cigarettes in GST regime has come down, as compared to the total tax in pre-GST regime.

            While any reduction in tax incidence on items of mass consumption would be welcome, the same would be unacceptable in case of demerit goods like cigarettes.

            The GST Council in its 19^th Meeting  held today i.e. on 17.07.2017 reviewed the Compensation Cess rates on cigarettes and recommended the following increase in the same with effect from 00 hours on 18^th July, 2017 i.e. the midnight of 17^th and 18^th July, 2017:

		Compensation Cess Rates
Tariff Item		Present rate	Proposed Increase	New rates
	Non- filter
2402 20 10	Not exceeding 65 mm	5% + Rs.1591 per thousand	Rs.485 per thousand	5% + Rs.2076per thousand
2402 20 20	Exceeding 65 mm but not 70 mm	5% + Rs.2876 per thousand	Rs.792 per thousand	5% + Rs.3668per thousand
	Filter
2402 20 30	Not exceeding 65 mm	5% + Rs.1591 per thousand	Rs.485 per thousand	5% + Rs.2076per thousand
2402 20 40	Exceeding 65 mm but not 70 mm	5% + Rs.2126 per thousand	Rs.621 per thousand	5% + Rs.2747per thousand
2402 20 50	Exceeding 70 mm but not 75 mm	5% + Rs.2876 per thousand	Rs.792 per thousand	5% + Rs.3668per thousand
2402 20 90	Others	5% + Rs.4170 per thousand	31%	36% + Rs.4170 per thousand

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