GST Council decisions provide relief to SME sector, exporters

GST likely for Netflix and iflix soon

The steps taken by the Council will provide urgent but temporary relief to SMEs, said V.K. Agarwal, former president of the Federation of Indian Small and Medium Enterprises.

Exporters, who have been facing sluggish growth due to global slowdown, will get refunds for the tax paid by them on exports during July from October 10, while refunds for tax paid for August will be given by October 18, he said.

Prime Minister Narendra Modi had said on Wednesday the government was committed to removing the glitches and bottlenecks of the GSTregime.

"The decision was good and beneficial for small traders". But after a whole day meeting, one thing that came forward is that the GST is a big failure. The government has already allowed exporters to furnish Letter of Undertaking (LUT) instead of bonds at the time of exports, which will help in making GST compliance easier and prevent working capital from being locked up.

The 22nd meeting of GST Council concluded a couple of hours back and as rumoured, there were a number of significant changes in the GST rules, which were initially implemented from July 1st, 2017.

Businesses having Rs 1.5 crore turnover make up 90 per cent of the taxpayer base but contribute only six per cent of tax.

Online entertainment streaming services such as Netflix and iflix are expected to be taxed under the proposed amendments to the Goods and Services Tax (GST) Act which will include the digital economy, says the Customs Department.

Ramakrishnudu further said that the GST council discussed issues faced by small traders, and requested quarterly filing of returns for small businesses.

Till then exporters' future exports they will become nominal GST, and on top of 0.1 per cent, merchant exporters can export.

Small businesses with sales up to Rs1.5 crore can also now file quarterly tax returns instead of monthly returns, although tax payment has to be made on a monthly basis.

The e-wallets will provide exporters the funds to pay the tax without choking liquidity and actual refunds will be offset against advance refund in e-wallet. Under the proposed facility, the government would immediately transfer the tax credit claims by way of notional amount in the e-wallets.

He further said that the reverse charge mechanism for transactions between registered, unregistered business has been deferred till March 31, 2018. These collections will not be the complete picture as these two months were early transitional phase.



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