Assam Finance Minister Himanta Biswa Sarma headed the Group of Ministers (GoM) of state finance ministers that have been set up to look into various issues pertaining to a scheme for small taxpayers under the Goods and Services Tax (GST), also known as the composition scheme has recommended inclusion of Goods and Services Tax (GST) in Maximum Retail Price (MRP).
The maximum retail price of goods must include GST component in order to address the consumer complaints that some retailers charge the new indirect tax on MRP of products.
The GoM has in its recommendation to the GST council that to easing compliance burden on small and medium enterprise suggested that the government should make it clear about the present law that MRP is the maximum price of a product to be sold in retail and charging anything above this is an offence.
This will create a great relief to the small traders and reduce the consumer complaints. The GoM will explore the possibility of bringing down the GST rate on MRP applicable to establishments like restaurants, eateries and malls that sell packaged goods such as bottled beverages which already carry an MRP, but at some places, a GST is charged over and above that MRP.
However assesse should submit all the invoices through return filing to the government can show the GST component and price of commodities separately.
As a result of this when a business issue invoice to the customers, the MRP should be inclusive of GST. The branching of tax amount and selling price can be shown to the government through issue of invoices.
Among other things GoM focused on bringing down the fee structure for delayed filing of returns to Rs 50 a day from Rs 100.
Currently, businesses with turnover of up to Rs 1.5 crore are allowed to file returns and pay taxes every quarter, so the panel directed for extending the quarterly filing of returns facility to all taxpayers.
It also added further simplification in HSN code and invoice matching. The major recommendation of the GoM includes slashing tax rate to 1 per cent for manufacturers and restaurants while easing norms for traders opting for it.
Manufacturers, restaurants and traders with turnover of up to Rs 1 crore pay GST under the composition scheme at 2 per cent, 5 per cent and 1 per cent respectively.
They planned to slash the tax rate to 12% with availment of input tax credit by dividing AC/Non-AC restaurants.
Also, eating out at hotels, which has room tariff of more than Rs 7,500, should attract a uniform 18 per cent tax rate instead of any separate category for 5-star hotel, the GoM recommended.
