New Delhi: In order to give relief to exporters, Union Finance Minister Arun Jaitley announced at the 22nd meeting of the GST Council on Friday that each exporter will get e-wallet, where he will be given a fundamental amount as a credit advance. Through which they can pay their taxes. Keeping in view the fact that exporters are facing credit barrier, which has affected their liquidity, the Goods and Services Tax (GST) Council has declared the roll of these e-wallets by April 2018.
The Arun Jaitley also said that exporters will be refunded back for the month of July and August by cheque by October 10 and October 18 respectively.
The e-wallets will provide the exporters the money to pay tax without suppressing liquidity and the actual refund will be offset against the advance refund in e-wallet.
It should be noted that before GST, the exporters were not paid taxes for the import of inputs for export purposes. However, after GST, IGST blocked its working capital. The Council reduced tax compliance in two ways on small and medium businesses.
First of all, the council has increased the limit to Rs. 1 crore to take advantage of the structure scheme from the companies of 75 lakh rupees.
Second, those who do business up to 1.5 crores and constitute 90 percent of the evaluation outside the structure plan will submit quarterly returns instead of monthly returns.
That, under the composition scheme tax rates is 1 percent for merchants, 2 percent for manufacturers and 5 percent for restaurants. In the service area, the composition scheme is only available for the restaurant.
On the much-awaited roll of the e-way bill, Jaitley said that it will be implemented on 1st April 2018.
The Reverse charge management has been postponed till March 31, 2018 for transactions between registered and unregistered businesses. Reverse charge means that the tax is due to pay, the supply of goods or services instead of the suppliers of such goods or services in relation to the information supplied categories.
As far as the rates are concerned, the GST Council has made some major changes too. Jaitley said, “Rates are tweaked on 27 items”.
The following changes have been made:
• Man-Made Yarn will now be taxed by 12 per cent slab compared to 18 per cent – this will affect the cost of textiles.
• Now 5 percent of Ayurvedic medicines will be GST, which was 12 percent earlier.
• A job like Zeri will now be taxed under 5 percent slab, while 12 per cent earlier.
• Stationary items will now grow by 18 percent compared to 28 percent earlier.
• Government contracts related to intensive labor, such as irrigation projects, will be levied on 5 percent GST.
• Diesel engines will now attract 18 percent GST instead of 28 percent earlier.
• The stones used on the floor except marble and granite – will now are applied to 18% instead of 28%.
• GST decreased from 18 percent to 5 percent for ICDS food packets for children.
• GST decreased from 12 percent to 5 percent on the chopped dry mangoes.
• Unbranded Namkeen will attract 5 percent GST.
• Plastic and rubber waste will have to do 5 percent GST instead of 18 percent.
• GST reduced from 12 percent to 5 percent on paper waste.
• Khakra and plain chapattis were reduced to 5 percent.
The Jaitley also said that there was an impression among members of the GST Council that the restaurant was not going to consumers on the benefits of input tax credit. In this regard, a committee of finance ministers will come back to the tax system for the restaurant.
