To bring simplicity and to reduce the compliance cost for the small taxpayers, the GST Council in its 22nd meeting has decided to allow taxpayers with Rs 1.5 crore to file quarterly returns and at the same time increased the threshold for composition scheme to Rs. 1 crore from the present Rs. 75 lakh. 

“For small businesses the tax burden is low, but the compliance pressure is greater. Members examined the provisions and after detailed study we found that large companies/taxpayers contribute to 94-97% of the taxes filed. Medium and small taxpayers need to be in the tax net so that the tax base keeps increasing, but their compliance burden should be reduced,” said Finance Minister, Arun Jaitley. 

Jaitley added that there is a large chunk of taxpayers in the Nil category, but have opted for GST registration. There are also a large number of taxpayers who have an annual turnover of Rs 1 crore or less. “This is big taxpayer base, of which 15.5 lakh are the ones who have opted for the composition scheme. Under composition scheme you need to file quarterly returns and hence it has been decided that taxpayers with turnover Rs. 1.5 crore, will also now file quarterly returns instead of monthly returns. About 90 % assesses will be covered by this scheme. Anyone above Rs 1.5 crore turnover will continue with the current system” said Jaitley 

The composition levy is an alternative method of levy of tax designed for small taxpayers whose turnover is up to Rs. 1 crore and pays a flat rate of tax regardless of what they manufacture, provide as a service or trade they carry on. Moreover, it is optional and the eligible person opting to pay tax under this scheme can pay tax at a prescribed percentage of his turnover every quarter, instead of paying tax at normal rate.

The GST Council has also reached a consensus on increasing the threshold limit for Composition Scheme to Rs 1 crore from the current Rs 75 lakh to ease tax filing for small traders. Under the Composition Scheme, traders have to pay a fixed tax rate between 1-5 percent.

The Council is also discussing other relief measures for traders, including quarterly return filing.

Chaired by Finance Minister Arun Jaitley, the 22nd meeting of the GST Council was attended by finance ministers of states and GST Secretariat officials.

As per Zee News report, the GST council has offered major sops to the SME sector under which businesses having annual turnover upto Rs 1.5 crore may be allowed to file GST returns once every three months. Exporters may be given relaxation in filing GST returns till March 2018.

Meanwhile, businesses with annual turnover less than Rs 20 lakh may be allowed to file the returns using a simple form.

The Group of Ministers, under Sushil Modi, set up to look into GSTN glitches is believed to have briefed the Council on the portal's functioning.

With over 33 lakh businesses filing the final GSTR-1 return, the GoM has tasked GSTN to send reminder text messages to the remaining 20 lakh businesses which are yet to submit the tax forms.#casansaar (Source - PTI, Economic Times)