On Friday 12th June 2020, the 40th GST Council meeting took place via video conferencing. This meeting was the first one after the Novel Corona Virus broke-out.
The 40th GST Council meeting was chaired by the Union Finance Minister Mrs. Nirmala Sitharaman. In this meeting, the GST council made significant declarations on GST return late fee waiver, the decreased loan fee, and so forth.
In this article, we will see the highlights of the 40th GST Council meeting.
Highlights of the 40th GST Council Meeting
Here are some of the major highlights of the 40th GST Council Meeting:
1. Interest Relief and Late fee waiver for MSMEs
Any enterprise whose turnover is 5 Crore INR or less, the interest rate for late filing of GST returns has been decreased from 18% to 9% per annum for the month of Feb, Mar and April 2020, for documenting return done before 30th September 2020.
In case if the taxpayer file the GST return 6th July 2020 or date as prescribe there will be no late fees or interest.
Likewise, if the returns are furnished before 30th September 2020 for the months of May, June, and July 2020, the late fee and interest will be deferred off.
2. No late charge for taxpayers with nil tax liability
The maximum late fee for every taxpayer who documents their returns between 1st July 2020 and 30th September 2020 is kept at 500 INR.
3. The due date for revoking the cancellation of GST registration extended
The maximum duration for revoking the cancellation of GST registration has been extended till 30th September 2020 for every one of those registrations which were dropped till 12th June 2020.
However, as per the GST Act, the due date is thirty days from the date of the issue of cancellation order.
4. The remedy of the Inverted Tax Structure
FM guaranteed that there is an issue of the excess refund being allowed for accumulated Input Tax Credit because of the inverted tax structure.
An elaborate conversation occurred about the issue relating to just the textile industry. However, unanimity was accomplished over the issue, the equivalent has yet been deferred to the future meeting as a decision couldn’t be taken right now.
5. Conversation on GST Compensation to states and Union Territories
GST Council is taking a gander at borrowing options for financing the states and Union Territories. In the previous two months, the GST collection has been 45% of the standard levels. The issue will be taken up in the special council meeting, which will be held in July 2020.
6. Rate Rationalization of certain products Postponed
When brought to the Council’s notification, Union Finance minister alongside the council members discussed the decrease in the GST rate of specific things. These items include pan masala and brick kilns. FM has guaranteed of taking up the issue in the following standard GST Council meeting.
Note: All the above changes will be notified through relevant circulars or notification