Highlights of 43rd GST Council meeting

Important Decision taken in the 43rd GST Council Meeting: -

GST Exemption to Covid related supplies till 31^st August 2021

Covid Related goods has been recommended for full exemption from IGST payment even if the goods are imported on payment basis for donation purpose. Earlier IGST exemption was available only when the goods were imported free of cost for free distribution.

Further in view of Black fungus the above exemption of IGST was extended to Amphotericin B.

Other Goods

• GST rate on Diethylcarbamazine (DEC) tablets has been recommended for reduction to 5% (from 12%).

Clarificatory amendments have been recommended in relation to GST rates: -

• Leviability of IGST on repair value of goods re-imported after repairs.
• GST rate of 12% to apply on parts of sprinklers/ drip irrigation systems falling under tariff heading 8424 (nozzle/laterals) to apply even if these 2 goods are sold separately.

Clarificatory amendments have been recommended in relation to below mentioned services: -

• Educational institution including anganwadi shall b exempt from levy of GST
• Examination fees charged by National Board of Examination (NBE), or similar Central or State Educational Boards, and input services relating thereto shall be exempt from GST.
• Supply of service by way of milling of wheat/paddy into flour (fortified with minerals etc. by millers or otherwise) /rice to Government/ local authority etc for distribution of such flour or rice under PDS is exempt from GST if the value of goods in such composite supply does not exceed 25%. Otherwise, such services would attract GST at the rate of 5% if supplied to any person registered in GST, including a person registered for payment of TDS.
• GST @ 18% shall be applicable on construction of a rope-way services provided to a Government Entity
• GST is payable on annuity payments received as deferred payment for construction of road. Benefit of the exemption is for such annuities which are 3 paid for the service by way of access to a road or a bridge.
• Services supplied by Government to its undertaking/PSU by way of guaranteeing loans taken by such entity from banks and financial institutions is exempt from GST.
• Landowner promoters can utilize credit of GST charged to them by developer promoters in respect of such apartments that are subsequently sold by the land promotor and on which GST is paid.

Amnesty Scheme to provide relief to taxpayers regarding late fee for pending returns

*The above reduced rate of late fee would apply provided GSTR-3B returns for these tax periods are furnished between 01.06.2021 to 31.08.2021.

Rationalization of late fee imposed under section 47 of the CGST Act

The late fee for delay in furnishing of FORM GSTR-3B, GSTR1, GSTR-4 and GSTR7 to be capped, per return, as below:

Other relief measure: -

In view of the current situation relief was provided by way to waiver of late fees and reduction in interest rate on account of delayed filing of return for the period March 2021 & April 2021. Notification in this regard was already issued by CBIC.

Other Extensions:

Cumulative application of rule 36(4) for availing ITC for tax periods April, May and June, 2021 in the return for the period June, 2021.

Allowing filing of returns by companies using Electronic Verification Code (EVC), instead of Digital Signature Certificate (DSC) till 31.08.2021.

Relaxations under Section 168A of the CGST Act: Time limit for completion of various actions, by any authority or by any person, under the GST Act, which falls during the period from 15th April, 2021 to 29th June, 2021, to be extended upto 30th June, 2021, subject to some exceptions.

Simplification of Annual Return

Amendments in Section 35 and 44 of CGST Act made through Finance Act, 2021 to be notified.

• Self-certification of reconciliation statement applicable from FY 2020-21.

• Optional filing of annual return in FORM GSTR-9 / 9A for FY 2020-21 for taxpayers having aggregate annual turnover upto Rs 2 Crore.

• Annual return required to be filed for the FY 2020-21 by the taxpayers with annual aggregate turnover above Rs 5 Crore.

Retrospective amendment in section 50 of the CGST Act with effect from 01.07.2017, providing for payment of interest on net cash basis, to be notified at the earliest.