CHANGES IN GST RATES

[As per discussions in the 22^nd GST Council Meeting held on 6^th October, 2017]

A.          GST RATE FOR CERTAIN GOODS

S. No.		Chapter/ Heading/ Sub-heading/ Tariff item			Description	Present GST Rate		GST Rate Recommended by the GST Council
1.		0804			Mangoes sliced dried	12%		5%
2.		1905 or 2106			Khakra and plain chapati / roti	12%		5%
3.		19 or 21			Food  preparations  put  up  in  unit containers   and   intended   for   free distributionto  economically  weaker sections   of   the   society   under   a programme  duly approved  by  the Central  Government  or  any  State Government, subjectto   specified conditions [Foot note 1]	18%		5 %
4.		21			Namkeens other than those put up in unit container and, - (a) bearing a registered brand name; or (b) bearing a brand name on which an actionable claim or enforceable right in a court of law is available [other than those where any actionable claim or enforceable right in respect of such brand   name   has   been   foregone voluntarily [Foot note 2]	12%		5%
5.		2710			Imposing   GST   only   on   the   net quantity  of superior kerosene oil [SKO] retained for the manufacture of  Linear Alkyl Benzene [LAB]	18%		18% [Clarification to be issued]
6.		30			Ayurvedic, Unani,  Siddha, Homeopathy medicines, other  than those bearing a brand name [Foot note 3]	12%		5%
7.		3213			Poster Colour	28%		18%
8.		3407			Modelling paste for children amusement	28%		18%
9.		3915			Plastic waste, parings or scrap	18%		5%
10.		4004 00 00			Rubber waste, parings or scrap	18%		5%
11.		4017 0020			Hard Rubber waste or scrap	28%		5%
12.		4707			Paper waste or scrap	12%		5%
13.		4907			Duty credit scrips	5%		Nil
14.		5401			Sewing thread of manmade filaments, whether or not put up for retail sale	18%		12%
15.		5402, 5404, 5406			All  synthetic  filament  yarn,  such  as nylon, polyester, acrylic, etc.	18%		12%
16.		5403, 5405, 5406			All  artificial  filament  yarn,  such  as viscose rayon, Cuprammonium,	18%		12%
17.		5508			Sewing  thread  of  manmade  staple fibres	18%		12%
18.		5509, 5510, 5511			Yarn of manmade staple fibres	18%		12%
19.		5605			Real Zari	12%		5%
20.		6802			All goods falling under heading 6802 [other than those of marble and granite or those which attract 12% GST]	28%		18%
21.		7001			Cullet or other waste or scrap of Glass	18%		5%
22.		8305			Fittings for loose-leaf binders or files, letter clips, letter corners, paper clips, indexing   tags   and   similar   office articles, of base metal; staples in strips (for example, for offices, upholstery, packaging), of base metal	28%		18%
	23.		8483		Plain Shaft Bearing 8483	28%	18%
	24.		84		Parts   suitable   for   use   solely   or principally  with  fixed  Speed  Diesel Engines of power not exceeding 15HP	28%	18%
	25.		84 or 85		Parts   suitable   for   use   solely   or principally with power driven pumps primarily designed for handling water,namely, centrifugal pumps (horizontaland  vertical),  deep  tube-well  turbine pumps, submersible pumps, axial flow and mixed flow vertical pumps	28%	18%
	26.		84 or 85		E-Waste	28%/18%	5%
	27.		Any Chapter		Biomass briquettes	18%	5%

Foot Note:

1.     Reduction in GST rate against S. No 4 above is subject to following condition:

a)     If the supplier of such food preparations produces a certificate from an officer not below the rank of the Deputy

Secretary to the Government of India or not below the rank of the Deputy Secretary to the State Government concerned to the effect that such food preparations have been distributed free to the economically weaker sections of the society under a programme duly approved by the Central Government or the State Government concerned, within five months from the date of supply of such goods or within such further period as the jurisdictional Commissioner of Central tax or jurisdictional Commissioner of State tax, as the case maybe, may allow in this regard.

2.       For S. No.5 above, the phrase registered brand name means:

a)     A brand registered as on 15.05.2017 shall be deemed to be a registered brand for the purposes of levy of 5% GST,

irrespective of whether or not such brand is subsequently deregistered.

b)     as on 15.05.2017 under the Copyright Act, 1957 shall also be treated as a registered brand for the

purposes of levy of 5% GST.

c)     A brand registered as on 15.05.2017 under any law for the time being in force in any other country shall also be

deemed to be a registered brand for the purposes of levy of 5% GST.

3.     For S. No. 7 above, the phrase “brand name” is defined as:

"brand name" or "trade name" means a brand name or a trade name, whether registered or not, that is to say, a name or a mark,such as symbol, monogram, label, signature or invented word or writing which is used in relation to such specified goods forthe purpose of indicating, or so as to indicate a connection in the course of trade between such specified goods and some person using such name or mark with or without any indication of the identity of that person.

B.    IGST EXEMPTION ON IMPORTS OF GOODS:

S.No.	Description		Present applicable IGST rate	Recommended IGST rate
1	IGST exemption on imports of rigs imported  for oil / gas exploration and production projects under lease, subject to the following conditions that:		5%	Nil
	(i)	Integrated tax leviable under section 5(1) of the IGST Act, 2017 on supply of service covered by item 1(b) or 5(f) of Schedule II of the Central Goods and Services Tax Act, 2017;
	(ii)	The rig is not sold without the prior permission of the Commissioner of Customs of the port of importation;
	to re-export the goods within 3 months from the expiry
	(iii)	of the period for which they were supplied under a transaction covered by item 1(b) or 5(f) of Schedule II of the Central Goods and Services Tax Act, 2017 out of India;
	to pay on demand an amount equal to the integrated
	(iv)	tax payable on the said goods but for the exemption under this notification in the event of violation of any of the above conditions and applicable interest.
2	Exemption from IGST on imports of medicines supplied free by international agencies like UNICEF, WHO, Red Cross etc.		12%/5%	Nil
3	Exemption from IGST on imports of bona fide gifts upto CIF value limit of Rs. 5000 imported through post or air.		28%	Nil

GST - SUPPLY OF GOODS NEW AMENDMENT

Clarification on issues wherein the goods are moved within the State or from the State of registration to another State for supply on approval basis

Circular No. 10/10/2017-GST

Various communications have been received particularly from the suppliers of jewellery etc. who are registered in one State but may have to visit other States (other than their State of registration) and need to carry the goods (such as jewellery) along for approval. In such cases if jewellery etc. is approved by the buyer, then the supplier issues a tax invoice only at the time of supply. Since the suppliers are not able to ascertain their actual supplies beforehand and while ascertainment of tax liability in advance is a mandatory requirement for registration as a casual taxable person, the supplier is not able to register as a casual taxable person. It has also been represented that such goods are also carried within the same State for the purposes of supply. Therefore, in exercise of the powers conferred under section 168 (1) of the Central Goods and Services Tax Act, 2017, for the purpose of uniformity in the implementation of the Act, it has been decided to clarify this matter as follows –

2.               It is seen that clause (c) of sub-rule (1) of rule 55 of the Central Goods and Services

Tax Rules, 2017 (hereafter referred as “the said Rules”) provides that the supplier shall issue a delivery challan for the initial transportation of goods where such transportation is for reasons other than by way of supply. Further, sub-rule (3) of the said rule also provides that the said delivery challan shall be declared as specified in rule 138 of the said Rules. It is also seen that sub-rule (4) of rule 55 of the said Rules provides that “Where the goods being transported are for the purpose of supply to the recipient but the tax invoice could not be issued at the time of removal of goods for the purpose of supply, the supplier shall issue a tax invoice after delivery of goods”.

3.               A combined reading of the above provisions indicates that the goods which are taken for supply on approval basis can be moved from the place of business of the registered supplier to another place within the same State or to a place outside the State on a delivery

challan along with the e-way bill wherever applicable and the invoice may be issued at the time of delivery of goods. For this purpose, the person carrying the goods for such supply can carry the invoice book with him so that he can issue the invoice once the supply is fructified.

4.               It is further clarified that all such supplies, where the supplier carries goods from one State to another and supplies them in a different State, will be inter-state supplies and attract integrated tax in terms of Section 5 of the Integrated Goods and Services Tax Act, 2017.

5.               It is also clarified that this clarification would be applicable to all goods supplied under similar situations.

GOODS AND SERVICE TAX PRACTITIONER

Officer authorized for enrolling or rejecting application for Goods and Services Tax Practitioner

Circular No 9/9/2017- GST

In pursuance of clause (91) of section 2 of the Central Goods and Services Tax Act, 2017 (12 of 2017) read with section 20 of the Integrated Goods and Services Tax Act, 2017 (13 of 2017) and subject to sub-section (2) of section 5 of the Central Goods and Services Tax Act, 2017, the Board, hereby specifies the Assistant Commissioner/Deputy Commissioner, having jurisdiction over the place declared as address in the application for enrolment as Goods and Service Tax Practitioner in FORM GST PCT-1 submitted in terms of sub-section (1) of section 48 of the Central Goods and Services Tax Act, 2017 read with sub-rule (2) of rule 83 of the Central Goods and Service Tax Rules, 2017 as the officer authorized to approve or reject the said application.

2.              It is also clarified than the applicant shall be at liberty to choose either the Centre or the State as the enrolling authority.

The choice will have to be specified by the applicant in Item 1 of Part B of FORM GST PCT-1. 

GST – NEW AMENDMENT

The GST Council, in its 22^nd meeting held at New Delhi on 6^th October 2017, has recommended the following facilitative changes.

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 sub-section (4) of section 5 of theIGST 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 tomitigate 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 ayable 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 toremove 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. 

GST SUMMARY

AGGREGATE TURNOVER	BELOW 20 LAKH, 10 LAKH IN SPL CAT STATES	BELOW 1 CRORE, 75 LAKH IN SPL CAT STATES	ABOVE 1 CRORE, 75 LAKHS SCS	EXEMPTED DEALERS
CATEGORY	UNREGISTERED	COMPOSITION	REGULAR	UNREGISTERED
LOCAL PURCHASES	ALLOWED	ALLOWED	ALLOWED	ALLOWED
LOCAL SALES	ALLOWED	ALLOWED	ALLOWED	ALLOWED
INTERSTATE PURCHASES	ALLOWED	ALLOWED	ALLOWED	ALLOWED
INTERSTATE SALES	NOT ALLOWED	NOT ALLOWED	ALLOWED	ALLOWED
INTERSTATE STOCK TRANSFER	NOT ALLOWED	NOT ALLOWED	ALLOWED	ALLOWED
INTERSTATE SERVICES	ALLOWED	NOT ALLOWED	ALLOWED	ALLOWED
RCM-SPL CATEGORY U/S 9(3)	COMPULSORY REGISTRATION	APPLICABLE	APPLICABLE	COMPULSORY REGISTRATION
RCM-URD U/S 9(4)	NOT ALLOWED	NOT ALLOWED TILL 31/03/18	NOT ALLOWED TILL 31/03/18	NOT ALLOWED
RETURNS REGULAR MONTHLY—3 QRTLY-1 COMPO.-QRTLY	NO RETURN	1 QRTLY 1 ANNUAL	BELOW 1.5 CRORE T.O. QRTLY  ABOVE 1.5 CRORE T.O. MONTHLY 3 + 1 ANNUAL	NO RETURN
INVOICE TYPE – EXEMPTED SUPPLY	ANY TYPE	BILL OF SUPPLY	BILL OF SUPPLY	ANY TYPE
INVOICE TYPE – TAXABLE SUPPLY	ANY TYPE	BILL OF SUPPLY	TAX INVOICE	ANY TYPE
OUTPUT TAX LIABILITY	NO LIABILITY	1%, 2%, 5% + RCM @ REGULAR RATES	REGULAR RATES	NO LIABILITY
INPUT TAX CREDIT	NO ITC	NO ITC	ALLOWED	NO ITC

GSTR – 2 AND 2A