A Relief for Housing Projects in 34th GST Council Meeting • 34th GST Council Meeting was recently held on 19th March 2019.
Key Highlights of 34th GST Council Meet• The transition plan for the implementation of the new tax structure for housing units has got approved by GST Council. • GST rates for new projects will be mandatory from April 1. • Builders of existing housing projects (completing construction by 31 st March 2019) would have two options 1. Choose the old rate of 12% (8% for affordable housing) and charge this GST Rate in the invoices raised. Further, input tax credit benefit is available and can be passed on to the buyer. 2. Choose to bear GST tax at the rate of 5% (1% for affordable housing as defined by GST law). The benefit of the Input Tax Credit (ITC) is not available to the builder for procurements used in construction. • Those who choose the 2nd option would have to return the accumulated ITC on their closing stock of under- construction properties in a proportion laid down in rules (to be notified) within six months. • The new rate of 5% (1% for affordable housing) will apply to those residential properties whose construction is going on even after 31st March 2019 or any new projects launched after 1st April 2019. Here, the benefit of ITC on procurements will not be available to the builders. • Not less than 80% procurement of materials should be from the registered dealer. • Up to 15% of commercial space to be treated as residential property for GST purpose.
Recent changes in GST Regime• GST Rates modification –
• Setting up of Goods and Services Tax Appellate Tribunal – A quasi-judicial body for dispute resolution between Centre and States. • e-way Bills
- 28 per cent slab is restricted to only luxury and sin goods.
- Rates on 23 goods and services have been cut down. (Including parts and accessories for the carriages for disabled persons, renewable energy devices etc.)
- Exempted frozen and preserved vegetables from the levy.
• Changes affecting MSMEs–
- It is a document required to be carried by a person in charge of the conveyance carrying any consignment of goods of value exceeding Rs. 50,000 from one state to another.
- Eliminate the need for separate transit pass in each state
- The validity of the e-way bill depends upon the distance the goods have to be transported.
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- Increase in Turnover Limit for the existing Composition Scheme (1.5 crores from 1 crore earlier)
- For MSMEs, annual filing of returns and quarterly paying of taxes would be available from April 1,2019.
- A tax rate of 6% (3% central GST and 3% state GST) for small service providers ( turnover less than 50 lakh)
GST council• A constitutional body under article 279(A) • Purpose – For making recommendations to the Union and State Government on issues related to GST. • Chaired by the Union Finance Minister • Other members are the Union State Minister of Finance and Ministers in-charge of Finance of all the States.
GST Composition Scheme• Purpose – To save small taxpayers from tedious GST formalities and enable them to pay GST at a fixed rate of turnover. • Taxpayers registered under this scheme pay a small tax (1%, 5% or 6%) on their turnover. • It reduces administrative burden of taxpayers • They are not eligible for input tax credits.
Goods exempted under GST• Notable exemptions i. Alcoholic liquor for human consumption ii. Five petroleum products viz. petroleum crude, motor spirit (petrol), high speed diesel, natural gas and aviation turbine fuel iii. Nuclear Fuel iv. Electricity v. Sanitary napkins vi. Fertilizers – Organic manure (without brand) vii. Newspaper, Paper and Paperboard; Articles of Paper Pulp • Food Products i. Fish, fresh or chilled ii. Live Animals iii. Dairy Produce, Natural Honey, Bird’s Eggs, Edible Products of Animal Origin (Not Specified Elsewhere) i. Live Trees and Other Plants, Roots, Bulbs, etc ii. Coffee, tea, mate and spices All goods of seed quality. iii. Fresh fruits other than in froze state or preserved. iv. Cereals in open packing (without brand name) v. Natural honey (without brand) • Pharmaceutical Products i. Human blood and its components ii. All kinds of contraceptives • Handlooms i. Ceramic Products ii. Charkha iii. Muddhas made of sarkanda iv. Phool bahari jhadoo v. Slate pencils and chalk sticks and Slates Read Also:-Election Commission Applies Brakes on Social Media Read Also:-Some Important Terminologies Related to Budget you should know