Short Summary of key aspects of 45th GST Council Meeting held on 17-09-21
(Note: More clarification would be available once the notification is issued to effectuate the same)
1. Changes brought in rate of tax:
-Some COVID-19 related item’s exemption has been extended till 31-12-2021 earlier it was 30-09-2021. (Refer table in Pt. A of the Press Release)
– W.e.f. 01.10.2021 Rate of tax on certain goods have been changed (Refer table in Pt. B of the Press Release)
– W.e.f. 01.10.2021 For services certain changes tax rates changed along with some new Exemptions (Refer table in Pt. F of the Press Release)
2. Section 9(4) that deals with payment of tax under RCM has been activated wherein Supply of mentha oil from unregistered person has been brought under RCM. Further amendment carried in Section 16 of IGST Act 2017 vide FA 2021 also activated wherein
it is recommended that exports of Mentha oil should be allowed only against LUT with refund of ITC i.e. it cannot be exported with payment of tax mechanism.
(Government wants to strictly monitor it’s usage)
3. Special composition scheme implemented for bricks.
4. Issue of footwear and textile industry regarding Inverted Duty Structure & Bringing specified petroleum products under GST is further deferred.
5. Clarification in relation to GST rate & classification of Goods (Dealt in Pt. G) and Services (Dealt in Pt. H) and GoM to be established to deal with compensation issue based on various information available like FASTags data etc.
6. ITC-04 compliance changed with relaxation:
-T/o upto 5Cr.- Annually
-T/o above 5Cr.- Once in 6 months
7. One of the most disputable issue regarding interest liability calculation which in no. of judgement has been settled by courts but still is again and again raised by department has been dealt. Now Interest @18% can be recovered on ineligible ITC availed and utilized i.e. if ITC not utilized then Interest cannot be levied. (A very favorable recommendation for industry)
8. Now, Unutilized balance of CGST & IGST cash ledger may be transferred between entities having same PAN but registered in different states. (Another welcome change)
9. Aadhaar authentication made mandatory for filing refund and application for revocation of cancellation of registration. (This option was made available long back on portal but industry didn’t took the same seriously. Govt. planning to implement its mandatory application in phased manner)
10. Now GSTR-1 Late fee would be auto-populated in next month GSTR-3B
11. Refund would be released to bank a/c linked with PAN used to obtain GST registration to curb frauds.
12. GSTR-1 cannot be filed if GSTR-3B of last month is not filed.
13. Once Sec. 16(2)(aa) as introduced in FA 21 gets notified then Rule 36(4) would be amended to include to restrict ITC strictly as per GSTR-2B.
14. Some circular & amendment in act & Rules would be notified in due course.
(Copy of Press Release attached)