GST Council meet begins: Faster refund, easy filings, special package for small enterprises are on agenda

The 22nd GST Council meet is underway in the national capital. The council is likely to address concerns raised by small-scale industries, traders and exporters. In the meet, the Council could take a host of decisions that includes - faster refunds to exporters, increase in threshold limit and easy tax filings. Earlier, Revenue Secretary Hasmukh Adhia had set up committee to look into the issues faced by the industry under the new taxation system. The committee is likely to submit its preliminary report to the Council today.

22nd GST Council meeting chaired by FM @arunjaitley gets underway at Vigyan Bhavan NDlh

— Ministry of Finance (@FinMinIndia) October 6, 2017

Reports suggest that based on the committee report, the Council may recommend some relaxation for exporters so that their working capital which is locked up in refunds is released. This will be the 22nd meeting of the GST Council. Last month, representatives from eight export promotion associations met the Revenue Secretary and expressed their concerns over an estimated amount of Rs 65,000 crore being held up in GST input credit if norms are not modified by December.

The GST council may also discuss easy compliance issue for exporters. In this regard, permission to file GST returns on a quarterly basis instead of every month might be granted. The government has already allowed exporters to furnish Letter of Undertaking (LUT) instead of bonds at the time of exports, which will help in making GST compliance easier and prevent working capital from being locked up.

The Hindustan Times today reported that the Council is expected to come out with major announcements reducing tax rates of several products, especially those that attract 28 per cent rate. It could also announce a special package for micro, small and medium enterprises. The move is expected to fix the recent economic downturn, the report said.

The GST council may also increase the threshold limit for the composition scheme. Currently it is Rs 75 lakh that could be raised to Rs 1-1.5 crore for micro, small and medium enterprises. Under the composition scheme, businesses pay a fixed rate to avoid GST paperwork. It is believed that the higher thresholds will ease the compliance burden and also reduce the filing load on the system.

Another item on the agenda of the full-fledged meeting of GST council might be to evaluate improvements in the functioning of GST Network, the IT backbone of the tax regime. A Group of Ministers led by Sushil Modi to look into GSTN glitches will brief the GST Council on the status of portal's functioning.