As per the latest amendment by the Goods and Services Tax Council, the cess on motor vehicles- ranging from mid-size cars, large cars, and sports utility vehicles have been increased by 2%, 5% and 7% respectively. This will replace the earlier 10% increase affected in the law, while keeping the overall tax incidence within 50%.
Thus, increasing the cess rate and the tax incidence on mid size cars to 45%, large cars to 48% and SUVs to 50% from 43% now. This, amid industry pitching for differential hike which meant lower increase for mid-sized cars since a higher increase would impact the middle class. In its last meeting, the GST Council had proposed for an amendment in the compensation law to raise the cess from 25% to 15%. The industry, which had cut prices in the high-end segment after the GST roll out, opposed an across the board increase in cess. However, there is no change in cess rate for hybrid vehicles, 13 seaters and small cars.
GST goes down for over 40 items
GST rates for the following items have gone down:
Walnuts, broom, clay idols custard powder, idly-dosa batter, rubber bands, raincoat, dhoop batti, saree fall, corduroy fabric, computer monitors, table and kitchenware, prayer beads. Khadi sold at KVIC outlets and clay idols have also been exempted, which replaced 40 state and central taxes and cesses.
Return filing date extended
The Council further unburdened industries struggling to meet the return filing deadline as the GSTN portal faces hiccups due to heavy load. The GSTR1, which was supposed to be filed by September 10, can be filed till October 10 by smaller businesses and large ones by October 3.
Also for easier compliance, the Council has allowed businesses to file the Simplified GSTR-3B for four months till December. Revenue Secretary Hasmukh Adhia said, "Companies with turnover of over Rs 100 crore the last date for filing GSTR1 will be October 3 and for the rest it will be October 10. Filing of GSTR-2 for July will have to be done by October 31, and GSTR-3 by November 10. For GSTR-1,2,3 we are giving a long rope and we are staggering the return filing date for July."
The Council said that the Date of GSTR 1, 2, 3 return filing for August will be communicated later. The issue of 5% increase in GST on pulses, cereals and flours, put up in unt container and bearing a registered brand name was also discussed by the Council. It has been determined that any brand registered on May 15, 2017, irrespective of the fact that it is de-registered later will face 5% tax. Among further amendments, the Council gave relief to handicraft traders who sell to other states and have a turnover of less than Rs 20 lakhs. Finance minister Arun Jaitley said that GST on about 30 items have been lowered after anomalies in the fixation of rates were pointed out.
Unbranded food items are exempted from the GST, whereas branded and packaged food items attract 5% rate. Hence, many businesses are deregistering their brands to avoid the levy.