The 27th GST Council Meeting was held on May 4th, 2018 wherein major agendas taken up by the Govt. and GSTIN are as below:
Major Agenda was,
Ownership Change for GST Network.
- Simplification of the GST return filing forms.
To clear the dues of farmers- Imposition of cess on sugar .
Below is the complete discussion over the same..
Simplification of GST Returns:
- GSTR 1 and GTR 3B will continue for the next 6 months.
- New Single-return plan will be live post 6 months.
- The GSTN shows the buyer, invoices uploaded by the seller and thus buyer can check the gap between the credit claimed by him and actually allowed to him.
- Post the new return going live, provisional credit can be claimed by the return preparers in the transitional phase of 6 months based on self calculations.
- After 6 months of the transition period, if it is noticed that after uploading the invoices, the seller has not paid the tax amount to the government, GSTN has all the right to recover these taxes from the buyer. There will be no automatic reversal of credit from the buyer in these cases.
- No provisional credit can be claimed after this 6 month transition period.
- Nil return preparers and Composition dealers will file GST returns quarterly
Transition to New GST Return Filing Procedure
GSTR 2 and GSTR 3 return filing will continue to remain suspended. The transition to new system of filing GST returns will be done in two stages as follows:
In stage 1, the current filing of GSTR 1 and GSTR 3B return will continue for a period of 6 months. During this time, the new system will be developed and tested.
In stage 2, the facility for invoice-wise data upload and also facility for claiming input tax credit on self declaration basis, will be introduced. In stage 2, the dealer will constantly upload invoices and the information about gap between credit available to them as per invoices uploaded by their sellers and the provisional credit being claimed by them will be calculated by the system. After 6 months of this phase 2, the facility of provisional credit will get withdrawn and input tax credit will only be limited to the invoices uploaded by the sellers from whom the dealer has purchased goods.
Changes to GSTN Ownership
Currently GSTN is owned by the Government (Central and State) along with five private financial institutions — HDFC, HDFC Bank, ICICI Bank, NSE Strategic Investment and LIC Housing Finance. GSTN is incorporated as a Section 8 Company.
Since, the data handled by GSTN is very sensitive, the ownership of GSTN will be fully transferred to the Central Government.
Incentive for Digital Payments
Keeping in view the need to move towards a less cash economy, the Council has discussed in detail the proposal of a concession of 2% in GST rate [where the GST rate is 3% or more, 1% each from applicable CGST and SGST rates] on B2C supplies, for which payment is made through cheque or digital mode, subject to a ceiling of Rs. 100 per transaction, so as to incentivise promotion of digital payment. This decision will also be taken before the next GST Council Meeting.
Reverse Charge Mechanism:
- Preponement of applicability of Reverse charge mechanism(Before June 30). This could be initially only for a particular class of taxpayers, say dealers under composition scheme.
Other Important Area:
- Imposition of a cess on sugar to help farmers
- Include Real Estate/transfer of property into the GST regime
- Amendment of the ITC provision in the GST to enable any business to take credit on any business-related expenses (employee transport etc.)
- Exemptions for payments made by employees for the services received from the employers (eg: canteen services)
- Based on various adjudications on anti-profiteering norms under GST, some clarity is expected from the council
- Encouragement for digital transactions by providing cash backs, discounts, credits etc.