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36th GST Council Meeting: Key Takeaways

On Saturday (27th July 2019), 36th GST Council meeting took place via video conferencing. The main motive behind this council meeting was to decide whether there will be any GST rate cuts on electronic vehicles or not. Currently, the GST Rate on electric vehicles is 12%.

In 35th GST Council meeting the rate cuts on electronic vehicles and chargers were referred to the fitment committee to check its feasibility.

 

 

1. Key takeaways of the 36th GST Council meeting

a) GST Rate Cuts to boost EV sector

In the 36th GST Council meeting, the GST rate on electronic vehicles has been reduced to 5% from 12%. In addition to this, the GST rate on charger/charging station has also been slashed down to 5% from 18%. Furthermore, to boost the electronic vehicle sector the electronic buses whose seating capacity is more than 12 seats can be hired by all the local authorities without GST.

The above changes will take place with effect from 1st August 2019. The fitment committee has estimated the revenue loss of 60 Crore INR that is relatively lower and feasible when the question is all about saving the environment. These decisions will give a real boost to the electronic vehicles industry that is still in a nascent stage. At the same time, ESSL (Energy Efficiency Services Limited) has planned to set-up more than 100 public EV charging stations at Noida (one of the most air-polluted cities in India)

The rate cuts will bring down the cost of electric vehicles which will, in turn, increase the demand for the electronic vehicle in the market as the price of EV will come down.

b) Due-date extended for service sectors under Composition Scheme

The due date for opting composition scheme in CMP-02 has been extended till 30th September 2019. This due date has only been extended for the service provider that are notified as per notification No. 2/2019-Central tax (rate) dated 07.03.2019. The earlier deadline for CMP-02 was 31st July 2019. Also, for the quarter April-June 2019, the due date for filing CMP-08 has been extended to 31st August 2019 that was earlier due on 31st July 2019. The announcement regarding the extension of date was much necessary as CMP-08 is not yet available for the taxpayers on the GST Portal.

2. Key-Pointers of 36th GST Council Meeting

a) Due date extensions

  • CMP-02 Form due-date extended to 30 Sept 2019 for a composition service provider
  • CMP-08 Form due date extended to 31st August for all the taxpayer for the April-June quarter.

b) GST Rate cuts

Here is the list of items and their before and after GST Rates:

Items Before After
Electric chargers/Charging stations 18% 5%
Electric vehicles (EVs) 12% 5%
The hiring of electronic buses having more than 12 seats by local authorities Not Possible Fully Exempt