Providing some relief to small businesses under the Goods and Services Tax (GST) regime, Finance Minister Arun Jaitley raised the annual turnover for availing composition scheme to Rs 1.5 crore from Rs 1 crore effective April 1, 2019. This move is aimed at wooing a key voting group ahead of Lok Sabha elections due later this year.
Speaking to the media after the GST Council Meeting here in New Delhi, Jaitley said, “Those who come under the composition scheme will pay tax quarterly, but the return will be filed only once a year. The GST exemption limit has been doubled to Rs 40 lakh annual turnover and Rs 20 lakh for northeastern states.”
The scope of the GST Composition Scheme, under which small traders and businesses pay a small tax based on turnover rather than value addition, was raised to Rs 1.5 crore from Rs 1 crore.
He also said that small companies would have the option to opt out of the GST tax net, adding that services and goods providers will get the benefit of composition tax.
The council also allowed Kerala to levy 1 per cent calamity cess on intra-state sales for a period of up to two years. On including real estate and lottery under the Goods and Services Tax, the council decided for form a seven-member group of ministers after differences of opinion emerged at the meeting, he said.
The suggestion to raise the exemption limit to MSMEs was raised by member of the ministerial panel Bihar Deputy Chief Minister Sushil Modi who had said the GoM was unanimous that the exemption limit should be increased but there were varied suggestions from different states and the final call will be taken by the GST Council.