38th GST Council Meeting Final Decisions on Key Points


The 38th GST Council meeting was chaired by the Union Finance and Corporate Affairs Minister Smt. Nirmala Sitharaman on 18th December 2019. Similarly, the meeting was attended by the Union Minister of State for Finance and Corporate Affairs, Shri Anurag Thakur. Also, the Finance Minister of the States and Union Territories and senior officials of the Finance Ministry attended the meeting. Here is the complete list of the 38th GST Council meeting decisions.

image of 38th gst council meeting decisions

GST Returns Filing Due Date and Late Fees

GSTR9 & 9C Annual Return: The Due date for filing the GST annual return for FY 2017-18 will be further extended till 31.01.2020. The previous deadline was 31.12.2019 for FY 2017-18. However, for FY 2018-19 the deadline is 31.03.2020.

In my opinion, the due date of 2017-18 extended because the simplified changes in GSTR 9 and GSTR 9C are not yet updated in the GST portal. Thus, the GSTN not only needs to modify the excel utilities as per the revised guideline but also they have to change their internal algorithm to accept the uploaded JSON file by the taxpayers. Therefore, the taxpayers will able to download the revised excel format of GSTR 9C and GSTR 9 in the coming week.

North Eastern States Extensions: The GST council decides to extend the due date of filing GST returns for the month of November 2019 in the North Eastern States.

Waiver of GSTR 1 Late Fees: The council has decided to Waive the late fees of all taxpayers if they file the GSTR-1 return by 10.01.2020. Therefore, the waiver will be applicable for the period from July 2017 to November 2019. Thus, who have not filed their GSTR 1 return, this will be the last opportunity to file them by 10th January 2020 without late fees. Similarly, the taxpayers shall note that they may have to pay late fees and even penalty if they do not file these returns on time.

SOP to handle non –filers of GSTR 3B: The government will issue a Standard Operating Procedure for its tax officers for taking necessary actions against non-filers of GSTR 3B returns.

Input Tax credit Limitations

The restriction on Input tax credit availed by the recipient on the tax invoices or debit notes is revised now. Therefore, now the recipient of goods or services will be able to avail the input tax credit only 10% in addition to the amount available in the GSTR 2A statement. However, the previous restriction was 20% which is now revised to 10%.

Therefore, the taxpayers will not be able to avail the input tax credit more than 10% then what it appears in his GSTR 2A. Thus, now the recipient of supplies will have to push more to his end suppliers to upload their GSTR 1 on a regular basis without delaying.

GST Rates Changes

GST Rate on lotteries: The GST council fixes a single GST rate i.e 28% on state-run and state-authorized lotteries. The previous rate was 12% on state-run lotteries and 28% on state-authorized lotteries. However, the revised rate will be applicable from 01.03.2020.

Rationalization of Single Rate on bags (18%): The GST Council fixes the single GST@18% on Woven and Non-Woven Bags. Similarly, the 18% rate will be applicable for sacks of polyethylene or polypropylene strips or similar items. Further, it is applicable for laminated and non-laminated bags also, which is used for the packing of goods that comes under HS code 3923/6305. The new rate shall be effective from 1st January 2020.

E way bill Blocking

The GST council again reminds the taxpayers that, the system will block e way bill generation in case it failed to file their GSTR 1 returns for two months/quarters.

GST Exemptions

The council decides to exempt the amount payable by entities having 20% or more from its previous limit of 50%. Thus, the amount payable for long term lease of industrial/ financial infrastructure plots having 20% or more ownership of Central or State Government is exempt. Therefore, the new changes will come into effect from 01st January 2020.

Constitution of Grievance Redressal Committees

The GST council decide to constitute the Grievance Redressal Committees (GRC) at Zonal/State level with both CGST and SGST officers. Similarly, it will include representatives of trade and industry and other GST stakeholders (GST practitioners and GSTN, etc.). Thus, these committees will address the grievances of the specific/ general nature of taxpayers at the Zonal/ State level.

Checks on Fake Invoicing

The GST council in its 38th meeting decided to take necessary actions for checking the menace of fake invoices and availing input tax credit on the basis of such fake documents.

Law Amendments in 2020

The GST council approves to amend various existing laws with regards to GST. Thus, the Finance minister will introduce these changes in 2020’s budget.

Future Roadmap on Revenue

The GST council has a discussion on topics like providing solutions to encourage voluntary compliance, expanding taxes, filing returns and improving tax collections. Similarly, working on automatic processing of e-invoices, new return systems, QR codes on bills, etc were discussed.

Further, the GST Council provided the necessary guidance on the analysis of the impact of exemptions and concession, tax base analysis, sensitivity analysis and compliance measures required to keep revenue going. At the same time, the Council also directed the immediate implementation of IT and other activities.

The above decisions of the 38th GST Council meeting will be effective only after the issuance of official notifications. Therefore, keep visiting GST India’s notifications page to check the latest GST notifications, circulars and orders.

Latest updates

The press release video after the 38th GST Council meeting

Top Expectations from 38th Council meeting

The 38th GST council meeting will be held on 18th December 2019. The meeting will be chaired by Smt. Nirmala Sitharaman. Here are some of the expectations and decisions that may be taken up by the GST council in its upcoming meeting.

  • GST officers may suggest to re-structure existing GST Rates
  • Centre may propose to increase the existing 5% slab anywhere between 6% to 8%.
  • Few Exempted items may come under GST slab
  • New GST returns may get further simplified as per the suggestions were given by stakeholders.
  • GST Annual Return filing date may get extend further as the revised format changes are still awaited.
  • Discussion on delay in compensation to states

Further, you may also see below, the video by Tax Talk on GST Expectations and decisions of the upcoming meeting.

Keep Visiting GST India News home page to check out the latest GST news and updates of the 38th GST council meeting decisions. However, this is not the exhaustive list of expectations from the upcoming meeting. Similarly, the council may take more initiative to improve the current GDP which is continuously coming down. Below is the GDP trend by Trading economics provided until July 2019.

source: tradingeconomics.com

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