43rd Goods & Service Tax Council Meeting will be held on 28th May, 2021, at 11 AM in New Delhi through video Conferencing. The council meeting is expected to announce some Covid relief measures, especially on compliance matters and GST rates on medicines & medical equipment’s. The meeting may also focus on few steps to amend the inverted duty while discussing the compensation Cess incurred between 2020-2021 due to possible shortage in Cess Collection.
The GST Council Meeting has not held since October 2020, last year, where the Finance Ministers Panel discussed the compensation for GST & the borrowing scheme offered by central government to compensate states for GST Deficit. Here are few points on which GST Council meeting will be held.
Expectations from 43rd GST Council meeting:
- The Goods & Service Tax Council is again expected to discuss the compensation issue for the current financial year. The 43rd GST Council meeting may take some steps to improve the Inverted duty structure without seeking any addition in GST rates or moving forwards towards converging GST to a 3 rate structure.
- Reverse Tariff Structure Correction is required, especially in Sectors such as fertilizes, solar modules, tractors, tyres, electrical transformers, steel utensils, pharmaceuticals, textile, cloths, railway locomotives among other goods.
Inverted duty or Reverse Tariffs means tax rates on inputs being higher than those which are levied on finished products. This translates into increased Input Tax credit claims by goods, in addition to several administrative and compliance issues
- 43rd GST council meeting may include 5 petroleum products under Goods &Service Tax, but has so far postponed its actual inclusion into the ambit of Goods & Service Tax as they fear big loss of revenue. However, the government is all set to bring Natural Gas under the GST regime, as it would be difficult to include the entire Petroleum products immediately under it. It may also take steps on lowering of GST rates for 2wheelers. The GST Council may reduce the rate of GST i.e. 28% on Two Wheelers to boost its sales affected during the pandemic.
- The Goods & Service Tax Council may also announce an Amnesty scheme on delayed returns which will provide huge relief to micro & small businesses & small taxpayers amid the pandemic in the upcoming meeting. Amnesty scheme will cover all the pending GSTR 3B since the launch of GST i.e. from 1 July 2017 till the month of April 2021.
- The GST Council is also likely to announce tax reliefs on certain Covid Management Equipment’s like Medical Grade Oxygen, Generators or Concentrators, Pulse Oximeters & Covid Testing Kits. The Council may consider cutting the GST rate from 12% to 5% to help lower the cost of treating Covid-19 Patients. It is also expected to enlarge the list of medical supplies for Covid that are eligible for exemption from IGST & Import Duties
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