The Goods and Services Tax ( GST ), still struggling to walk without complexities is again changing its face from tomorrow. The more simplified new GST rules are likely to help a large number of middle-class traders.
Apart from this, the reduction in GST on the real estate sector as recommended by the GST Council this month will also be implemented from tomorrow.
The major changes to be implemented from Monday are as follows:
GST exemption threshold limit increased
Earlier, the threshold limit for GST was Rs. 20 lakhs. This has been increased to Rs. 40 lakh subject to certain conditions. Now, persons having turnover below Rs. 40 lakhs are not liable to obtain GST registration.
Composition scheme for goods supplier (Increase in turnover limit for the existing)
The limit of annual turnover in the preceding financial year for availing composition scheme for goods shall be increased to Rs 1.5 crore. This will include composition scheme for service providers (or mixed supplier of goods and services), composition scheme for service providers (or mixed suppliers) with a tax rate of 6% (3% CGST +3% SGST) having an annual turnover up to Rs 50 lakh.
Beneficiaries will be small service providers like work contractors, property rentals, architects, a mixed supplier of goods and services to pay at nominal rate@6% under composition. Presently, they were required to pay @ 18%. No need to pay unless one crosses the threshold limit of Rs 20 lakh for the first time in any year.
Relief to Realty Sector
The GST Council, has accepted the demand of Confederation of Real Estate Developers’ Association of India and reduced rates on construction items and made it builder-friendly and home buyer-friendly. These will be applicable from April 1. Now, GST on an affordable house to be 1% and it on under construction and ready at 5%.
Relief on Use of GST credit towards Tax Payment
The taxpayer can choose to pay off SGST using IGST credit, even if the latter is not used to set off CGST liability. This will improve the efficiency of credit utilization in the GST system while helping the concerned company with marginally increased working capital.
New GST return Deferred
Earlier, it was decided that the new, simplified GST return format would be implemented from 1st April 2019 on a pilot project basis and the new forms would be made available once they are notified and the software is ready. It was said that mandatory filing across the country would kick in from July.
“The pilot project of new return filing has been deferred. New date would be decided. The forms would be notified first; following which, the pilot would be launched. Systems are being developed for the new forms,” an official said.
