GST council may reconsider products under 28% slab, ease filing returns

The Goods and Services Tax (GST) Council on Friday is expected to come out with major announcements reducing tax rates of several products, especially those that attract 28% rate besides easing the process of filing returns, a move that will not only help businesses but also customers across the country just ahead of Diwali.

The council chaired by Union finance minister Arun Jaitley will hold a meeting on Friday.

A government official told the Hindustan Times that the council will focus on all issues of traders and businesses, who have registered their concerns ahead of the festive season, to ensure that all genuine issues are addressed immediately.

The glitch in the GST network portal, where all traders and businesses have to mandatorily file their returns, is one of the major challenges. Prime Minister Narendra Modi has held a meeting with finance minister Arun Jaitley on the implementation of the new tax structure.

“The PM too is concerned and there could be some major announcements today,” the official said.

The small traders besides exporters have been the worst hit by the GST implementation. A proposal to increase the threshold of the composition scheme from the current Rs 75 lakh to Rs 1 crore or even higher would be looked into by the council.

Under the composition scheme, all small businesses with a turnover of less than Rs 75 lakh were exempt from complying with the rigorous return filing process and pay a fixed percentage of turnover as a tax.

Refunds of tax too have not been paid as yet, leading to a squeeze in money situation for many traders, including exporters.

The council is likely to take immediate steps to ensure that refunds are released. The reverse charge mechanism, under which tax is charged on a registered entity buying goods or services from an unregistered one could also be deferred.

“The GST has been deeply fractured owing to the lethargic attitude of GSTN portal and absence of any nodal authority to monitor the execution of the new tax structure ... Traders across the country are anxiously looking at the GST Council meeting today,” Praveen Khandelwal, secretary general of Confederation of All India Traders (CAIT), said.

“ ... We are hoping that the filing of returns would be made simpler while rates on several products will be brought down,” he added.