Eating Out At Restaurants Could Become Cheaper, GST Rate Under Review

Chelsea West
October 8, 2017

Minister of State for Finance Shiv Pratap Shukla on Saturday hinted that the peak goods and services tax (GST) rate of 28 per cent will gradually be reduced. GST on sliced dried mango, Gujarati delicacy khakra, unbranded namkeen and unbranded Ayurvedic medicine was slashed from 12 per cent to 5 per cent.

A panel is reviewing the 18 per cent GST tax rate that you now pay for eating out at AC restaurants. The scheme can be availed only by those businesses that operate within state and do not have inter-state sales.

The Kerala Finance Minister said that the issues likely to dominate the discussion at Friday's meeting include how to ease the compliance burden of the small and medium enterprise (SME) sector. So the threshold has been now increased. So far, only one sixth or 15 lakh of the 90 lakh registered entities have chosen the composition scheme.

The GST Council also announced a tax relief for exporters.

State Commercial Taxes Department, which keeps a record of tax collection, said the drop is not expected to continue in the future.

The panel also eased tax rules related to exports, aiming to provide quick refunds and tackle a cash shortage faced by many exporters, Mr. Jaitley said during a news conference.

From April 1, 2018, the government would launch e-wallet for the exporters.

"As a long term solution, an e-wallet will be created for every exporter where a notional amount will be given in advance.the refund will be offset later against that amount".

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The most pressing problem is to do with the availing of input tax credits by exporters.

However, to claim the input tax credit on inputs used in the manufacture of exported finished goods, exporters either have to pay IGST, which can be claimed as refund after the goods have been exported, or export under bond/Letter of Undertaking (LUT) without payment of IGST. The GoM will have to file its report within a two-week period.

The council also agreed to bring e-Way bill by April 1 to facilitate movement of goods from one check post to another.

Along with this, the GST Council said it was open to more suggestions from stakeholders before it meets in Guwahati on November 9-10.

The reverse charge mechanism has been deferred until August 31, 2018. GST Council has considered the implementation experience of the last three months and given relief to small traders...

Jaitley said a number of representations had been received and the council had made a decision to give relief to small and medium enterprises (SMEs) and exporters. Currently, anyone making inter-state taxable supplies is compulsorily required to register, irrespective of turnover.

# Service providers with turnover less than Rs 20 lakh are exempt from inter-state service. Service providers can not, however, opt for the composition scheme.

After assessing the readiness of the trade, industry and government departments, it has been decided that registration and operationalisation of TDS/TCS provisions shall be postponed till March 31, 2018.

Other reports by TheSundaySentinel

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