“The reverse charge mechanism will be reviewed by a committee of experts”. For the GST tax rate of 12 per cent, it is split at 6 per cent Central GST (which goes to the Centre’s kitty) and 6 per cent State GST (which goes to the state’s kitty). The e-wallet system is expected to rollout from April 1, 2018, he added.
Jaitley also announced that for a long-term solution of exporters e-wallet will be created where national amount will be given in advance. This credit will be used to pay the IGST or GST for his products. A technology firm will develop the e-wallet.
Till then exporters’ future exports they will become nominal GST, and on top of 0.1 per cent, merchant exporters can export.
A major problem with the GST has been its multiple tax rates. The GOM will have to submit its report within a period of two weeks. Also, domestic supplies to these exporters would be treated as deemed exports and refunds of tax paid on such supplies be given to the supplier.
“Council members requested quarterly return filings for businesses with turnover less than Rs 1.5 crore”, a Council member said on the sidelines of the meeting. Along with that, the threshold for composition scheme has been increased from ₹75 lakhs to ₹1 crore and it is going to impact a lot of traders.
Traders will now have to pay fixed tax rate between 1% – 5% under the composition scheme.
“We appeal to people to file returns on time. This will benefit small businesses and substantially reduce compliance costs”, Jaitley said.
“The collection pattern observed so far shows that a substantial portion of the tax is coming from the big players”, Mr Jaitley said. So if the trader gives 1 per cent, whether the exempted goods will come under that category or will stay out.
Under this, registered taxpayers had to pay tax on purchasing goods from non-registered suppliers.
Also, Infosys has sent its technical representatives to all the states to help them address the issues.
As per available information, from July 1 till date, the department has earned revenue of total Rs 491.79 crore through GST (inclusive of Value-Added Tax on petroleum), which is 22 percent less compared to the same period – July-September 201 – wherein an amount of Rs 628.27 crore on Value-Added Tax was deposited with the State exchequer. Jaitley said the experiment had been successful. Asserting that genuine corporates will not face action, the minister of state for corporate affairs said non-compliant companies are tarnishing the image of good ones. The Bill is required even if goods are transferred from one vehicle to the other.
In a meeting with the Revenue Secretary last month, exporters had said that an estimated Rs 65,000 crore is locked up in GST refunds.