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08 August 2017

20th GST Council Meeting - Certain Highlights

The GST Council under the chairmanship of the Union Finance Minister, held its 20th meeting on 5-8-2017 at New Delhi. The Council took several decisions including, granting of in-principle approval to E-way Bill provisions and implementing anti-profiteering measures, relaxation in GST rates for certain services and fixing of liability on e-commerce operator in respect of small housekeeping services provided through them.

 

E-Way Bill provisions finalised

In-principle approval was accorded to E-Way Bill Rules, which provide technology driven tracking of movement of goods. According to the provisions, there will be no check-posts and human interface will be minimised. The Council has recommended that E-way bill would when value of the consignment transported is more than Rs. 50,000. For transportation of goods within 10 kms, e-way bill will not be required. Exempted goods have been kept out of the purview of this requirement. The system will be notified shortly and will be implemented across the country. Routine review of this system has also been proposed by the Council.

 

Approval to setting up of committees under anti-profiteering provisions

The Council also gave approval to constitution of Standing Committee and State-level Screening Committees as provided in the provisions relating to anti-profiteering. Anti-profiteering measures aim at ensuring passing of benefits of reduced rate of tax or increased availability of credits, under GST to consumers.

 

GST rates for certain services

GST rates for various items of job- work throughout the textile chain and in relation to textile related items like apparels, shawls, carpets, is proposed to be reduced from 18% to 5 %.

GST rate for Government Work Contracts is proposed to be reduced to 12%, with ITC available on inputs, from the earlier rate of 18%. Both Central and State Government Work Contracts are covered.

Certain tractor parts will attract 18% GST instead of previous rate of 28%.Tax rate on Agricultural Services of post-harvest and storage is also proposed to be reduced to 12% from earlier rate of 18%.

Services of goods transport agency (GTA) and rent-a-cab will attract 12% GST with full ITC or 5% GST with no ITC.

It may be noted that CBEC is yet to issue any notification amending the existing GST rates for abovementioned goods and services.

The Council has also given its recommendation to the Central Government that it may move legislative amendments to increase the maximum ceiling of compensation cess, levied on motor vehicles falling under headings 8702 and 8703, including SUVs, to 25% from the current rate of 15%.

GST Council will meet at Hyderabad, on 9th September, 2017, for its 21st meeting. Decision on GST rate on branded foods items is likely to be taken then.