The GST Council also announced tax relief for exporters. "So far 15.5 lakh taxpayers have opted for composition scheme", Jaitley said. The small traders also got relief as they can file returns once in three months. Similarly, the reverse charge mechanism for transactions between registered and unregistered businesses has been deferred till March 31, 2018. Tax rate on rotis and khakra, savouries, and ayurvedic and homoeopathic medicines was also reduced.
The E-way bill, which allows for the seamless movement of goods worth over Rs. 50,000, is likely to be implemented April 1, 2018. The exemption that is given to the exporters is going to be profitable for them. Exporters have been anxious over the delayed refunds welcomed the changes, as these would help address their liquidity problems.
"The refund of GST for the month of July by 10th October and August by 18th October will address the liquidity concerns of the exporters", he said.
The Council considers the "e-wallet" as the permanent solution to cash blockage, as this would be credited with a notional amount as if it is an advance refund.
The government also revoked GST notification on gems and jewellery.
This is in addition to a proposal to increase the threshold for the composition scheme to Rs 1 crore from Rs 75 lakh, which will allow small businesses, inlcuding eateries, to pay 1-5% tax (based on the businesses they are in) without having to deal with the three-stage filing process, sources told TOI.More news: 'Calm Before the Storm': Trump Makes Cryptic Remarks at Military Dinner
Small and medium enterprises had complained of tedious compliance burden under the Goods and Services Tax (GST) that was supposed to be a simple indirect tax regime which replaced over a dozen Central and state taxes.
While addressing the media after the GST Council's meeting Arun Jaitley said the Council has chose to cut GST rate on 27 commonly used items including manmade yarns of different types - a major demand by the textile industry, especially in Surat.
Eating out is set to become cheaper with the GST Council agreeing to reduce the GST rate from the current 18 percent to 12 per cent. Jaitley said a group of ministers would revisit the tax on AC restaurants.
Inaugurating a National Conclave on GST, organised by PHD Chamber of Commerce and Industry (PHDCCI), Shiv Pratap Shukla, Minister of State for Finance, urged India Inc not to measure the execution of GST in its first phase of three months as it was a big tax reform and needed "minimum one year" for its ideal implementation. A technology company will be allotted the task of developing the e-wallets for exporters.
# GST on "Khakhra" reduced from 12% to 5%. Service-providers then may deposit GST only on services where GST might not have been deposited by those availing service.
Friday's move, which comes almost 100 days after the indirect tax levy was rolled out on 1 July came in response to representions from India Inc over difficulties in filing returns and securing refunds.