Several changes on GST rates on goods and services were announced by ‘MSME-focused’ 28th GST Council meeting concluded on July 21, 2018. Several prolonged decisions such as simplification of returns filing and exempting tax on sanitary napkins were finally taken in the meeting along with slashing of GST rates on several general-use items such as while goods consisting of TV (upto 27 inch), washing machine, refrigerators etc., paints, wall putty, scents, cosmetics, marble, stones etc.
The Central Government has now given effect to the recommendations of GST Council vide various notifications dated July 26, 2018 and all such notifications, unless specifically mentioned, shall be effective from July 27, 2018. Important pointers of all such notifications has been summarised for you easy digest:
|Notification No.||Gist of Amendments|
|Notification No. 13/2018 -Central Tax (Rate)||
The Central Government has amended Notification No. 11/2017- Central Tax (Rate) dated June 28, 2017 in the following manner:
Thus, Hotel industry has been given major relief by providing that the rate of tax on accommodation service shall be based on transaction value instead of declared tariff.
|Notification No. 14/2018 -Central Tax (Rate)||
The Central Government has amended Notification No. 12/2017- Central Tax (Rate) dated June 28, 2017 to exempt certain services like:
to its own members against consideration in the form of membership fee upto an amount of one thousand rupees (Rs 1000/-) per member per year.
Certain clarification and rationalisation have also been made and few important of them are as under:
|Notification No. 15/2018 -Central Tax (Rate)||The Central Government has amended Reverse Charge Notification No. 13/2017-Central Tax (Rate) dated June 28, 2017 as under:
|Notification No. 16/2018 -Central Tax (Rate)||
In terms of Notification No. 14/2017- Central Tax (Rate)dated June 28, 2017, services by way of any activity in relation to a function entrusted to a Panchayat under Article 243G of the Constitution, undertaken by CG, SG or any local authority was neither treated as a supply of goods nor services.
Now, this notification has been amended to include services by way of any activity in relation to a function entrusted to a Municipality under Article 243W of the Constitution. Thus, the same shall also be treated neither as a supply of goods nor services.
Further, now these services undertaken by union territories shall also be given same treatment.
|Notification No. 17/2018 -Central Tax (Rate)||Clause (a) under Item no. (vi) of S. No. 3 in Notification No. 11/2017 – Central Tax (Rate) dated June 28, 2017 prescribed GST rate of 12% for specified works contract services provided to CG, SG, UT, governmental authority, local authority or government entity meant for purposes other than business or profession.
Now, an explanation has been inserted to clarify the meaning of ‘business’ to state that the term ‘business’ shall not include any activity or transaction undertaken by the CG, SG or any local authority in which they are engaged as public authorities.
|Notification No. 18/2018 -Central Tax (Rate)||The Central Government has amended Notification No. 01/2017-Central Tax (Rate) dated June 28, 2017 dealing with list of applicable tax rates on various goods, to provide revised list of rate classification as per recommendations of the 28th GST Council meeting.|
|Notification No. 19/2018 -Central Tax (Rate)||The Central Government has amended Notification No. 02/2017-Central Tax (Rate) dated June 28, 2017 dealing with list of exempted goods, to provide revised list of exempted goods as per recommendations of the 28th GST Council meeting.|
|Notification No. 20/2018 -Central Tax (Rate)||The Central Government has amended Notification No. 5/2017-Central Tax (Rate), dated June 28, 2017, whereunder list of goods were mentioned in respect of which no refund of unutilised input tax credit was allowed where the credit has accumulated on account of inverted duty structure.
In the said notification, list of items contained in serial numbers 1, 2, 3, 4, 5, 6, 6A, 6B, 6C and 7 (pertaining to fabric sector) has been amended so as to allow refund of accumulated ITC arising on account of inverted duty structure on supplies received on or after August 01, 2018. In respect of any supplies received before such date, the accumulated ITC shall lapse.
|Notification No. 21/2018 -Central Tax (Rate)||
The Central Government has amended notification No. 01/2017-Central Tax (Rate), dated June 28, 2017 to provide for concession in rate of GST on handicraft goods.
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