New structure to rationalise GST slabs, 28% uniform tax rate for lottery, GSTR-9 extended, a mobile app to file GST: GST News In A Minute

The possibility of an app for filing GST returns and an extension on the due date of GSTR-9, these updates and more on #GSTThisWeek.

Finance panel suggests new structure to rationalise GST slabs
The Fifteenth Finance Commission (FFC) has suggested the Goods and Services Tax (GST) Council to simplify tax rates by creating just three slabs. Similar to other countries like Singapore that prefer standardised GST rates across one or more tax slabs, the Finance Panel has suggested implying a standard rate of 17%, a lower merit rate for items of common consumption and a higher rate on luxury and sin goods.

Companies that have filed for bankruptcy might get GST relief.
In a bid to help companies with bankruptcy resolution, the Government is considering allowing companies that filed for resolution under the Insolvency and Bankruptcy Code (IBC) to pay current levies of the  goods and services tax without the mandatory payment of past dues. The current GST framework doesn’t allow a firm to file current tax dues if it has past dues - obviously this becomes a big hurdle for companies trying to resolve bankruptcy. The decision, if taken, will help firms under the IBC process and will grant them much needed tax relief.

GST Council fixes 28% uniform tax rate for lottery
From March 2020, the GST on State run and private lotteries will be fixed at 28%. At present, lotteries run by state governments attract 12% GST, while those authorised but sold outside the State are taxed at 28%.

Due date for annual return in FORM GSTR-9 extended to 31 January 2020.
One of the outcomes of the 38th GST council meeting that was held on 18th December 2019 is that taxpayers will be allowed a waiver on the late fee for pending GSTR-1 from July 2017 to November 2019, if the same are filed by 10 January 2020. However, if taxpayers have not filed Form GSTR-1 for two tax periods, their e-way bill system will be blocked. Additionally, ITC to the recipient in respect of invoices or debit notes that are not reflected in the taxpayer’s FORM GSTR-2A shall be restricted to 10% of the eligible credit.

Finance Ministry may develop app to file GST
The Finance Ministry is considering setting up facilitation centres and developing an app to help traders and small businesses file their GST returns. Similar to Aadhar Seva Kendras, these facilitation centres could even be expanded to cover income tax filing in the future.

Financial sector demands reduction in GST
In a pre-Budget meeting with Finance Minister Nirmala Sitharaman, representatives from the financial sector and capital markets demanded a GST rate cut on term insurance. Term insurance currently attracts a GST rate of 18% on the basic term policies but if an individual wishes to purchase add-on policies, they are charged a GST of 28% on the premium. Financial firms want a reduction in this rate for increasing its penetration and streamlining KYC norms.

For more information on GST and GST Compliance, visit www.avalara.com

Avalara is an experienced application service provider (ASP) and partner of authorized GST Suvidha Providers (GSPs). To understand how our cloud-based application Avalara India GST can help you with GST compliance automation, contact us through https://www.avalara.com/in/products/gst-returns-filing