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GST council defers hike on textiles

The current economic slowdown and impact of coronavirus has compelled the GST Council to defer the proposal to hike GST rates on fertilisers, footwear and textiles.

On the other hand, the council has increased the tax rate on mobile phones and specified parts to 18 percent. Currently, mobile phones attract a GST rate of 12 percent, while its inputs are taxed at 18 percent.

The Council, chaired by union finance minister Nirmala Sitharaman, has also given relief to domestic maintenance, repair and overhaul (MRO) services, by slashing the rate to 5 percent with a full input tax credit (ITC).

Earlier, GST Council nominated fitment committee had proposed to provide level playing field to domestic MRO industry vis-à-vis foreign MROs. The recommendation is to reduce GST on MRO services to 5 percent with full ITC and change Point of Supply (PoS) for B2B MRO services to the location of recipient. Currently, Indian MROs are paying 18 percent GST.

In another move, the Council has decided to extend the deadline for filing of GSTR9, GSTR9C for FY18-19 till June 30, 2020. Also, the filing to be mandatory for taxpayers over Rs 5 crore of annual turnover. The earlier deadline was March 31 and turnover limit was Rs 2 crore.

 
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