GST council sets exemption threshold for tax at Rs.20 lakh
Posted on:26 Sep 2016 09:19:26
26 September 2016 Current Affairs GK: The first meeting of Goods & Services Tax (GST) Council has decided to exempt businesses with annual turnover below Rs.20 lakh out of the GST net.
The meeting was presided by Union Finance Minister Arun Jaitley in New Delhi and was attended by Finance ministers of states.
Exemption Issue : Threshold for exemption for businesses in Northeastern and hill states will be for annual turnover below Rs.10 lakh and rest of India it will below Rs.20 lakh. The Northeastern and hill states have been accorded special status by the Constitutional Amendment paving the way for the GST.
Administrative Control Issue : Consensus was reached on the contentious issue of administrative control over indirect tax assessees. States will have sole jurisdiction over assessees having a turnover of Rs.1.5 crore or less. In case turnover exceeding that limit, the administrative control will be jointly with the central and state governments. The existing 11 lakh service tax assessees will continue to be under the jurisdiction of the Centre. Revenue officials in the States will be trained for assessing assessees in the services sector as GST allows states to also tax services.
Compensation formula : The compensation that Central Government will pay to states for losses of revenue because of the transition to GST regime will be routinely, quarterly or bi-monthly.
Base Year: The GST Council also agreed to settle 2015-16 as the base year for calculating the compensation
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