New Delhi: The GST Council on Thursday agreed to slash tax rates on around 29 goods and 54 category of services, including diamonds and precious stones, 20-litre water bottles, second-hand vehicles, tailoring services, some handicraft products, entry into theme parks, joy rides, among others.
Union finance minister Arun Jaitley said the council will discuss the prospects of bringing petrol and diesel and real estate under the GST in the next meeting — a move that could bring down the petrol and diesel prices.
In the backdrop of criticism by trade and industry over GST’s huge compliance burden, the Council veered arou-nd the idea of making the GST return filing process simpler by filing only one return in a month where only supply inv-oices will be adequate to pay tax. The filing of GSTR 1, 2 and 3 will be discontinued in the future under the new system.
He said the new process would be finalised in the next Council meeting which will be held before the Union Budget. The new tax rates would be effective from January 25.
Petrol, diesel, realty to be considered for GST
Union finance minister Arun Jaitley said that under-reporting of the revenue was a concern especially among those registered under compliance scheme.
He said that e-way bill will be one of the anti-tax evasion measure which will be implemented across country from February 1 and 15 states have agreed to also implemented for intra-movement of goods from next month.
Infosys co-founder Nandan Nilekani gave a presentation to the Council on the model to simplify return filing process. Bihar Deputy Chief Minister Sushil Modi, GSTN chairman Ajay Bhusan Pandey and Mr Nilekani would formalise the structure.
GST Council decided to provide a three-year GST exemption for viability gap funding given under the regional air connectivity scheme. The scheme, also known as UDAN (Ude Desh ka Aam Naagrik) seeks to connect unserved and under-served airports as well as make flying more affordable. The participating airlines are eligible for VGF subject to certain conditions.
In a good news for housing societies, GST council has decided to enhance the exemption limit of Rs 5,000 per month per member to Rs 7,500 in respect of services provided by Resident Welfare Association to its members against their individual contribution.
GST rate will be cut on transportation of petroleum crude and petroleum products (petrol, diesel and ATF) from 18 percent to 5 percent without input tax credit and 12 per cent with ITC.
The Council approved to reduce job work services rate for manufacture of leather goods and footwear to 5 per cent. It agreed to increase threshold limit for exemption from GST for all the theatrical performances like Music, Dance, Drama, Orchestra, Folk or Classical Arts in any Indian language in theatre from Rs 250 to Rs 500 per person.
GST Council decided to reduce GST to 12 percent in respect of mining or exploration services ofpetroleum crude and natural gas. Subscription of online educational journals/ periodicals by educational institutions who provide recognised degree will be exempt from GST.
GST Council clarified that services provided by senior doctors, consultants and technicians hired by the hospitals, whether employees or not, are healthcare services which is exempt. The Centre expects around Rs 1,100 crore annual loss from the cuts in the GST rates announced on Thursday.
