GST News, Notifications, and Announcements

Updated on Aug 21, two thousand seventeen – 02:45:44 PM

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GST was very first announced in two thousand by the then government. Seventeen years later it is now a reality with the date for implementation set for July 1, 2017. Since 3rd August, 2016, when the Rajya Sabha very first passed the bill introducing GST in the 122nd Amendment of the Constitution, there have been many switches in the proposed GST bill and the rules and regulations pertaining to it.

We regularly publish all GST related news here.

Latest GST Notifications

Central Tax Notifications

Composition Scheme- Notification three & 8/2017

Composition scheme threshold has been notified to be seventy five lakhs (earlier recommended only). This will be beneficial to petite businesses.

Notification three contains the composition scheme rules which had been issued ealrier on 17th May.

Switch sides Charge- Notification Five/2017

The persons who only supply goods/services on which switch roles charge applies, are exempted from registering under GST registration.

For example, For example, Ola Cabs enlist drivers to ply their cars. Drivers are providing chauffeur/driving services to Ola and Ola is the service receiver.

Ola pays GST on the drivers’ services on switch roles charge basis. Drivers are not required to register under GST thus removing the cargo of tax compliance from individuals with limited resources (drivers) to large companies (Ola) with enough resources.

Sections coming into force-Notification one & 9/2017

With the Notification of nineteen th June and twenty eight th June, most of the CGST Act is now in force. Only sections fifty one & fifty two (TDS & TCS respectively) are not applicable as the government has relaxed TDS & TCS provisions for the time being to give more time to the e-commerce sellers.

Sections 42(9) & 43(9) are not applicable.

These clauses say that if the output tax liability is diminished (or input tax credit is enhanced) due to a debit note (or a credit note) [mismatch of invoices reconciliation] then such amount shall be refunded by crediting electronic ledger. This is not applicable right now as there will not be any reconciliation for two months.

HSN Codes-Notification 12/2017

Every registered person with turnover more than 1.Five crores must mention the HSN Codes in each and every invoice.

However, the numbers of digits to be mentioned in the Invoice depends on the annual turnover in the preceding financial year.

This is effective from one st July, i.e., all invoices from one st July must be GST compliant and have details of HSN codes.

The same notifications have also been made under IGST (notification Five).

Rates of interest-Notification 13/2017

The rates of interest are same as mentioned in the Act. The notification ratifies the rates.

This notification shall come into force from the 1st day of July, 2017

The same notification has also been made under IGST (notification 6).

Common Portal- Notification four /2017

It is notified that the website of the Common Portal is www.gst.gov.in managed by Goods and Services Tax Network.

Modes of verification-Notification six & 11/2017

The modes of verification are-

• Aadhaar based Electronic Verification Code (EVC)
• Electronic verification code generated through net banking login on the common portal
• Electronic verification code generated on the common portal

[Points ii & iii substituting the earlier Bank account based OTP as per earlier notification]

Central Tax Rate Notification (28.06.2017)

1. Most of the goods are kept at the same rates as announced by the GST council earlier but rough or nonindustrial unworked diamond or precious stones will be charged CGST at the rate of 0.125%.
2. List of goods exempt from CGST. No switch in the list.
3. Oil, gas, coal and petroleum licenses and sub-contract licenses and leases will be charged GST at the rate of Two.5%.
4. The person liable to deduct TDS as per the GST law supplying intrastate goods or services to an unregistered person would be exempt from CGST.
5. Cashew nuts, not shelled or peeled, Bidi wrapper leaves (tendu), Tobacco leaves, silk yarn, Supply of lottery would have switch sides charge applicable under GST.
6. Refund of the unutilized ITC would not be provided in the case of the tax on output being lower than the tax on inputs for certain goods mainly related to the textile and railways.
7. The supply of goods by CSD to unit run canteens and authorized customers and supply of goods by the unit run canteens to the authorized customers.
8. 50% of the tax paid on inward supplies of goods by the CSD for further supply to unit run canteens or authorized customers can be claimed as refund under GST.
9. Person liable to deduct TDS as per the GST law supplying intra goods or services to an unregistered person would be exempt from CGST.
10. Intrastate supply of 2nd arm goods by a registered person who deals in selling 2nd forearm goods to an unregistered person would be exempt from CGST.

Integrated Tax

Sections in force-Notification No. Three/2017

The Central Government has notified that provisions of sections four to 13, sixteen to Nineteen, 21, twenty three to twenty five of The Integrated Goods and Service Tax Act, two thousand seventeen shall come into force from 1st July 2017.

Provisions of CGST will also apply for IGST- Notification No. Four/2017

The Integrated Goods and Services Tax Rules, two thousand seventeen have been notified and are deemed to have come into force retrospectively from 22nd June 2017.

The Central Goods and Services Tax Rules, 2017, for carrying out the provisions specified in section twenty of the Integrated Goods and Services Tax Act, two thousand seventeen shall, so far as may be, apply in relation to integrated tax as they apply in relation to central tax. Section twenty mentions the CGST provisions that will apply mutatis mutandis for IGST.

Integrated Tax (Rates) Notifications

Cases where the e-commerce operator will pay IGST- Notification No. 14/2017

E-commerce operator will pay the IGST in the following services-

• Transportation of passengers by a radio-taxi, motorcab, maxicab and motor cycle (Eg. Ola outstation from Bangalore to Chennai)
• Providing accommodation in hotels, inns and other commercial places meant for residential or lodging purposes. For example a petite hotel registered on Oyo rooms. Oyo rooms will pay IGST However, if the person (hotel) supplying such service through e-commerce is liable for registration under GST then that person will pay. Eg, Ibis Hotel is a large multi-chain hotel also registered on Oyo rooms. Then Ibis Hotel will pay.

It will come into force with effect from the 1st July, 2017.

Goods on which switch sides charge applies-Notification No.Four/2017

A list of goods on which switch sides charge applies is issued by CBEC. When the supply is made by the specified person, then IGST will be payable on switch sides charge basis by the recipient of the intra-state supply of such goods. All the provisions of will apply to such recipient.

No ITC for Construction- Notification No. 12/2017

No refund of unutilized ITC will be permitted input tax credit shall be permitted for IGST in construction of a sophisticated, building etc. (works contract). Except in cases where the entire consideration has been received after issuance of completion certificate or after its very first occupation, whichever is earlier.

This is in keeping with the provision of not permitting ITC.

This will come into force with effect from the 1st day of July, 2017.

Switch roles Charge- Notification No. Ten/2017

List of services on which switch roles charge is applicable is issued. It is the same as issued under CGST Act.

In the public interest exempts, the following are exempted from IGST (& also CGST)-

• The supply of goods by the Canteen Stores Department (CSD) to the Unit Run Canteens or
• The supply of goods by the CSD/Unit Run Canteens to the authorized customers

The CSD can claim a refund of 50% on IGST of all input goods received by it for subsequent supply of such goods to the Unit Run Canteens or to the authorized customers of the CSD.

This notification shall come into force with effect from the 1st July, 2017.

Inverted Rate Structure- Tax On Inputs>Tax On Outputs- Notification No.Five/2017

Refund of unutilised ITC will NOT be permitted, when the ITC is accumulated due to rate of tax on inputs being higher than the rate of tax on the output goods (except nil rated or fully exempted goods).

High tax on the imported raw materials compels manufacturers to raise price. On the other mitt, foreign finished goods have lower tax rate.. In conclusion, manufactured goods by the domestic industry becomes uncompetitive against imported finished goods.

List of goods on which this notification applies.

For UIN & Diplomats Notification No. 13/2017

This notification specifies the conditions applicable –

• UN or specified international organisations and
• Foreign diplomats in India

Panchayat services- Notification No. 11/2017

Constitutional services of the Panchayat are not covered under GST.

News on GST Act

The entire framework of GST is based on GST Act. It was devised by the GST Council, which is a committee consisting of the Union Finance Minister (Chairperson), the Union Minister of State, the minister in-charge of finance or taxation or any other minister nominated by each State Government.

News on Rule Switches

The GST is a constitutional amendment, and any switch in the law will also affect the rules therein. Rules for invoicing, rules for penalty, rules defining the point of taxation – these are just some of the examples of any rule switch in the model law.

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