Highlights of the New GST Amendments
On June 28th and 29th, 2022, our Finance Minister presided over the 47th GST Council Meeting in Chandigarh. As a result, the council made a number of significant decisions, ranging from GST return filing to GST rate changes. The important highlights have been explained below:
Annual returns for F.Y. 2021-22 may be notified with minor modifications.
● For the fiscal year 2021-22, GSTR-9 and GSTR-9A remain inapplicable to those with an aggregated turnover of less than Rs.2 crore.
● Proposals for broad changes to Form GSTR-3B will be made public to solicit feedback and suggestions from stakeholders.
● Once all pending returns have been filed, the suspension of GST registration will be automatically lifted.
● The requirement for a proportionate ITC reversal on the supply of duty credit scrips is being eliminated.
● The limitation under Section 73 of the CGST Act for issuance of orders relating to demands linked to the due date of annual return for F.Y. 2017-18 has been extended until September 30, 2023.
E-commerce suppliers are relaxed:
● The GST Council agreed to alleviate compliance bottlenecks for e-commerce vendors.
● It enabled e-commerce suppliers to register under the composition scheme for intrastate supplies, easing their registration burden and lowering their tax liability.
● Once the I.T. system is in place, the new composition scheme for e-commerce suppliers for intrastate online sales will be implemented on January 1, 2023.
● Interstate suppliers on e-commerce platforms will not be allowed to register as a composition taxpayer.
Extensions of deadlines for composition taxpayers:
● GSTR-4 for F.Y. 2021-22 will be exempt from late fees until July 28, 2022, as opposed to the previous extension up to June 30, 2022.
● The CMP-08 deadline for April-June 2022 (Q1 of F.Y. 2022-23) has been extended from July 18 to July 31, 2022.
GST Changes in Specifics:
- Earlier, GST was exempted on certain food items, grains, and so on when they were not branded, or the right to the brand was waived. It has been suggested that the exemption range be revised to exclude prepackaged and pre-labeled retail packs per the Legal Metrological Act, including pre-labeled curd, lassi, and buttermilk.
- The following items shall not be subject to exemptions in their entirety.:
| Particulars | Before Change | After Change |
| Cheques, lose or in book form | NIL | 18% |
| Maps and hydrographic or similar charts of all kinds, including atlases, wall maps, topographical plans, and globes printed | NIL | 12% |
| Parts of goods of heading 8801 | NIL | 18% |
1. GST exemption is being withdrawn on the below-mentioned Services:
| Particulars |
| Transportation by rail or vessel of railway equipment and material. |
| Storage or warehousing of commodities that attract tax |
| Fumigation is a warehouse of agricultural produce. |
| Services by Reserve Bank of India (RBI), Insurance Regulatory and Development Authority (IRDA), Securities and Exchange Board of India (SEBI), Food Safety and Standards Authority of India (FSSAI), and Goods and Services Tax Network (GSTN). |
| Renting of a residential dwelling to registered business entities. |
| Services are provided by cord blood banks by way of preservation of stem cells. |
2. Changes in GST Rates of Goods:
| Particulars | Before Change | After Change |
| Printing, writing, or drawing ink | 12% | 18% |
| Power-driven pumps are primarily designed for handling water. For example, centrifugal pumps, deep tube-well turbine pumps, submersible pumps, and bicycle pumps | 12% | 18% |
| LED lamps, lights, and fixtures, and their metal printed circuits board | 12% | 18% |
| Drawing and marking out instruments | 12% | 18% |
| Solar water heater and system | 5% | 12% |
| Prepared/finished leather, chamois leather, composition leather | 5% | 12% |
| Orthopedic appliances − splints and other fracture appliances, artificial parts of the body, or other appliances that are worn or carried, or implanted in the body to compensate for a defect or disability, intraocular lens | 12% | 5% |
| Ostomy appliances | 12% | 5% |
| Tetra packs (aseptic packaging paper) | 12% | 18% |
| Cut and polished diamonds | 0.25% | 1.5% |
| IGST on specified defense items imported by private entities or vendors, when the end-user is the defense forces of India | Applicable rate | NIL |
| Cheques, lose or in book form | NIL | 18% |
| Petroleum/coal bed methane | 5% | 12% |
| E-waste | 5% | 18% |
| Maps and hydrographic or similar charts of all kinds, including atlases, wall maps, topographical plans, and globes | NIL | 12% |
3. Changes in GST Rates of Services:
| Particulars | Before Change | After Change |
| Services supplied by the foreman to chit fund | 12% | 18% |
| Job work in relation to the processing of hides, skins, and leather | 5% | 12% |
| Job work in relation to the manufacture of leather goods and footwear | 5% | 12% |
| Job work in relation to the manufacture of clay bricks | 5% | 12% |
| Works contract for roads, bridges, railways, metro, effluent treatment plant, etc. | 12% | 18% |
| Works contract service supplied to Central and State governments, local authorities for historical monuments, canals, dams, pipelines, plants for water supply, educational institutions, hospitals, etc. and its sub-contracting | 12% | 18% |
| Works contract service supplied to Central and State governments and local authorities involving predominantly earthwork and its sub-contracting | 5% | 12% |
| Transport of goods and passengers by ropeways | 18% | 5% (with ITC for services) |
| Renting of truck/ goods carriage where the cost of fuel is included | 18% | 12% |
Note: The new GST rates for the relevant goods and services will be made effective from July 18, 2022.
Casino & Gaming Taxation
Despite reports of a flat 28 % GST levy on casinos and skill gaming, the council has deferred its decision until the next meeting in August 2022. The GST Council has directed the Group of Ministers (GoM) to re-examine the issue of casinos and online gaming and report back to the GST Council.
Modifications to GST refunds
Inverted duty Structure: A change in the formula for calculating refund amounts has been proposed and implemented to assist taxpayers who are also eligible for ITC on input services.
Refund claims for Integrated GST (IGST): A facility for online transmission of such IGST refund claims to the jurisdictional GST authorities for expeditious processing and disposal will be provided for exporters identified as risky and requiring verification of IGST refund by the GST authorities.
Exclusion of period for filing refund claim: It is proposed to exclude the period from March 1, 2020, to February 28, 2022, from the calculation of the limitation period for filing a refund claim by an applicant and also for issuing a demand/order in respect of erroneous refunds.
Re-credit of erroneous refund to electronic credit ledger: Re-credit of erroneous refund amount sanctioned to a taxpayer is proposed, for which a new FORM GST PMT-03A is recommended to be introduced. This will allow taxpayers to re-credit the amount of an erroneous refund that they have paid back in their electronic credit ledger.
Electricity exporters will be able to claim a refund of unutilized ITC on such zero-rated supplies.
Thus, the latest conclusion of the 47th GST Council meeting is a mix of many GST rate increases and a few rate reductions. Mostly changes to improve the system’s compliance. But all of these changes affect everyone’s day-to-day lives in some way; the GST Act has an unspoken philosophy that ‘The Only Thing Constant is Change’.
To know more read the government notification on the same. To stay up to date on all GST changes, updates, and amendments, visit www.gstrobo.com on a regular basis.
