The 22nd meeting of the Goods and Services Tax Council held at New Delhi decided to give big relief for small traders under the new tax regime.
The Council, as part of Governments initiative to ease norms for small traders and to reduce their compliance burden, has enhanced the threshold limit for opting for composition scheme.
Composition scheme is an alternate method of taxation, which allows small businesses with annual turnover up to Rs 75 lakhs, to pay tax at a concessional rate, as well as reduce the compliance cost. The revenue threshold is Rs 50 lakhs for dealers across nine states including Arunachal Pradesh, Nagaland and Tripura among others. The enrollment into the plan is optional.
The Threshold limit is now enhanced to 1 crore from 75 lakh.
Under composite scheme traders, restaurants & manufacturers will pay 1% , 5% & 2% respectively.
The last date for opting for composition levy has expired on 30th September 2017. With the increase of threshold limit, the registration window for opting the scheme is likely to open soon.
Further, it was decided to postpone the implementation of reverse charge mechanism till March.
Also, Small and Medium Enterprises having turnover up to 1.5 crores need not file monthly returns. They need to file only quarterly returns under the new tax regime.
