Current Affairs GST Council Meeting Highlights Chaired by FInance Minister Nirmala Sitharaman

GST Council Meeting Highlights Chaired by FInance Minister Nirmala Sitharaman

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40th GST Council meeting was held on Friday, 12th June 2020 via video conferencing.
40th GST Council meeting chaired by the Union FM Nirmala Sitharaman and made important announcements on GST return late fee waiver, reduced interest rate further being extended on account of COVID-19 crisis.

GST late fee reduction for prior periods 1st July 2017 to 31st January 2020 is as follows:

No late fee for taxpayers with nil tax liability
Maximum late fee is Rs 500 per return for the taxpayers who file their returns between 1st July 2020 and 30th September 2020.

For small taxpayers whose aggregate turnover is up to Rs 5 crore, the rate of interest for late furnishing of GST returns for Feb, Mar and April 2020, beyond 6th July 2020 (as per staggered dates), is being reduced from 18% to 9% p.a, for filing of returns done before 30th September 2020. Note that there is no interest charge if tax for these months is paid before 6th July 2020 or date as applicable based on turnover. Also, for the months May, June and July 2020, the late fee and interest will be waived off, if the returns are filed before 30th September 2020.

Period for seeking revocation of cancelled GST registrations allowed till 30th September 2020 for all those registrations which were cancelled till 12th June 2020. The timelimit, as per GST Act, was thirty days from the date of issue of the cancellation order.

GST Council is looking at a borrowing option for funding the compensation to states and UTs. The GST collections have been 45% of the usual levels in the past two months. The matter will be taken up in a special one-agenda council meeting, which is going to be scheduled in July 2020.

FM claimed that there is an issue of excess refund being granted for accumulated ITC due to inverted tax structure. An elaborate discussion happened about the issue pertaining to only the textile industry. However, sectors such as footwear and fertilisers could not be picked up for discussion. Although a unanimity was achieved over the matter, the same has yet been postponed to the future meeting as a decision could not be taken at this point in time.

FM along with the members discussed the rate reduction of certain items as these were brought to the Council’s notice. These include: brick kilns, and pan masala related items. FM has assured of taking up the matter in the next regular GST Council meeting.