The Hush Post |17:40 am |two-minute-read
The GST Council, chaired by Finance Minister Arun Jaitley has doubled the exemption limit for GST registration for micro, small and medium enterprises (MSMEs) to Rs 40 lakh from the current Rs 20 lakh.
Essentially, it amounts to businesses with an annual turnover under Rs 40 lakh will now be exempted from GST.
The GST Council also approved the composition scheme for services and raised annual composition limit to Rs 1.5 crore from Rs 1 crore. This will be effective from April 1. The composition scheme is an alternate method of taxation. It allows small businesses with annual turnover up to Rs 1 crore (now Rs 1.5 crore) to pay tax at a concessional rate as well as reduce the compliance cost.
Under the GST regime, service taxpayers who earn up to Rs 50 lakh per annum will be taxed at 6 per cent. There will be only one tax return for entities, who opt for composition scheme.
The council has allowed the state of Kerala to impose a cess of up to 1 per cent on intrastate sales for two years, the finance minister Mr Jaitley said.
A committee has been set up to consider the GST rates in the real estate sector. However, a consensus is yet to be achieved on it, he said.
The GST Council met today, amid expectations of rate reduction on cement, bringing under-construction residential properties in the 5 per cent slab and raising the threshold limit for MSMEs.
In its last meeting which was held on December 22, Jaitley had said that based on the report of the fitment and law committee, Council will decide on GST rate of residential properties, with a provision for claiming an input tax credit (ITC).
Homebuyers of real estate properties do not have to pay GST if they purchase a ready-to-move-in property after the issue of completion certificate as it considered as ‘transfer of property’ and comes under state’s jurisdiction of stamp duty.