All eyes were on the 35th GST Council meeting last Friday with big bang reforms expected – at the helm, chairing the all important committee was our new Finance Minister Nirmala Sitharaman.
While the council did touch upon a few important aspects, the first GST Council meeting under the new government did not deliver any big surprises and was rather lacklustre. There was some expectation that the council would consider a significant cut in rate of taxes across the board in order to help spur consumer demand that has been sagging in recent quarters, but that was not the case.
The council, during its half day meeting imposed stiff penalties on companies not passing on the rate cut benefits to consumers and cracked the whip on undue profiteering by such companies by approving a penalty of up to 10% of the profiteered amount against the current norm of levying a maximum fine of just 25,000 ₹. In addition, the council also extended the tenure of the anti-profiteering authority by two years till November 2021.
In a relief to GST return filers, the council extended the date for filing GST returns for year 2017-18 by two months till August 31th 2019. Many filers were facing problems with form GSTR-9C, which is the reconciliation form as it was new to them and quite extensive. Keeping that in mind, the council provided relief by extending the date by two months.
In another procedural change, Aadhaar Card has now been approved as sufficient proof to obtain GST registration, thereby eliminating the need for multiple documentation.
Even as the GST collection has crossed the 1 Trillion ₹ mark per month (which is 1 Lakh Crore ₹) for the last three months, revenue collections have still largely failed to meet the government’s target. Perhaps it is because of this reason that the highly expected cut in tax rates on electric vehicles from 12% to 5% was not implemented.
Other amendments include a rollout of an electronic invoicing system for tickets of GST registered multiplexes and cinema halls to curb the menace of fake tickets.
The contentious issue of a uniform tax rate on lotteries has been referred to the Attorney General of India.