The GST Council in its 47th Meeting has recommended changes in rates of certain goods and services. Clarifications on various aspects of GST have also been issued.
These changes/clarifications shall come into force only after relevant rules/notifications/circulars are issued.
Update 18.07.2022 : The relevant notifications have been issued and explained in our blog posts
Proposed changes in GST Rates
The rate changes recommended by the 47th GST Council will be made effective from 18th July, 2022.
|1||Works contract supplied to central and state governments, local authorities for historical monuments, canals, dams, pipelines, plants for water supply, educational institutions, hospitals etc. & sub-contractor thereof||12%||18%|
|2||Works contract for roads, bridges, railways, metro, effluent treatment plant, crematorium etc.||12%||18%|
|3||Works contract supplied to central and state governments, union territories & local authorities involving predominantly earthwork and sub-contracts thereof||5%||12%|
|4||Job work in relation to processing of hides, skins and leather||5%||12%|
|5||Job work in relation to manufacture of leather goods and footwear||5%||12%|
|6||Job work in relation to manufacture of clay bricks||5%||12%|
|7||Transport of goods and passengers by ropeways.||18%||5% (with ITC of services)|
|8||Renting of truck/goods carriage where cost of fuel is included||18%||12%|
|9||Services supplied by foreman to chit fund||12%||18%|
|1||Printing, writing or drawing ink||12%||18%|
|2||Knives with cutting blades, Paper knives, Pencil sharpeners and blades therefor, Spoons, forks, ladles, skimmers, cake-servers etc||12%||18%|
|3||Power driven pumps primarily designed for handling water such as centrifugal pumps, deep tube-well turbine pumps, submersible pumps; Bicycle pumps||12%||18%|
|4||Machines for cleaning, sorting or grading, seed, grain pulses; Machinery used in milling industry or for the working of cereals etc; Pawan Chakki that is Air Based Atta Chakki; Wet grinder;||5%||18%|
|5||Machines for cleaning, sorting or grading eggs, fruit or other agricultural produce and its parts, Milking machines and dairy machinery||12%||18%|
|6||LED Lamps, lights and fixture, their metal printed circuits board;||12%||18%|
|7||Drawing and marking out instruments||12%||18%|
|8||Solar Water Heater and system;||5%||12%|
|9||Prepared/finished leather/chamois leather / composition leathers;||5%||12%|
|11||Orthopedic appliance- Splints and other fracture appliances; artificial parts of the body; other appliances which are worn or carried, or implanted in the body, to compensate for a defect or disability; intraocular lens||12%||5%|
|12||Tetra Pak (Aseptic Packaging Paper)||12%||18%|
|13||Tar (whether from coal, coal gasification plants, producer Gas plants and Coke Oven Plants.||5%/18%||18%|
|14||Cut and Polished diamonds||0%||2%|
|15||Petroleum/ Coal bed methane||5%||12%|
|16||Scientific and technical instruments supplied to public funded research institutes||5%||Applicable rate|
|18||Cheques, lose or in book form||Nil||18%|
|19||Maps and hydrographic or similar charts of all kinds, including atlases, wall maps, topographical plans and globes, printed||Nil||12%|
|20||Parts of goods of heading 8801||Nil||18%|
|21||IGST on import of Diethylcarbamazine (DEC) tablets supplied free of cost for National Filariasis Elimination Programme||5%||Nil|
|22||IGST on specified defence items imported by private entities/vendors, when end-user is the Defence forces.||Applicable rate||Nil|
Proposed changes in GST Exemption
GST was exempted on specified food items, grains etc when not branded, or right on the brand has been foregone.
It has been recommended to revise the scope of exemption to exclude from it prepackaged and pre-labelled retail pack in terms of Legal Metrology Act, including pre-packed, pre-labelled curd, lassi and butter milk.
Refund of accumulated ITC not to be allowed on flowing goods:
Exemption for following services are being WITHDRAWN
- Exemption on following services is being withdrawn.
- Transportation by rail or a vessel of railway equipment and material.
- Storage or warehousing of commodities which attract tax (nuts, spices, copra, jaggery, cotton etc.)
- Fumigation in a warehouse of agricultural produce.
- Services by RBI,IRDA,SEBI,FSSAI,GSTN.
- Renting of residential dwelling to business entities (registered persons).
- Services provided by the cord blood banks by way of preservation of stem cells
- Like CETPs, common bio-medical waste treatment facilities for treatment or disposal of biomedical waste shall be taxed at 12% so as to allow them ITC
- Hotel accommodation priced upto Rs. 1000/day shall be taxed at 12%
- Room rent (excluding ICU) exceeding Rs 5000 per day per patient charged by a hospital shall be taxed to the extent of amount charged for the room at 5% without ITC.
- Tax exemption on training or coaching in recreational activities relating to arts or culture, or sports is being restricted to such services when supplied by an individual.
- Exemption on transport of passengers by air to and from NE states & Bagdogra for other than economy class is withdrawn
Present exemption of IGST on import of goods under AA/EPCG/EOU scheme to be continued
The recommended changes in GST Law are
- The following provisions to be notified at the earliest-
- Retrospective amendment in section 50(3) of CGST Act, with effect from 01.07.2017,to provide that interest will be payable on the wrongly availed ITC only when the same is utilized;
- Amendment in sub-section (10) of section 49 of CGST Act to provide for transfer of balance in electronic cash ledger of a registered person to electronic cash ledger of CGST and IGST of a distinct person.
- Waiver of late fee for delay in filing FORM GSTR-4 for FY 2021-22
- Extension of due date for filing FORM GST CMP-08 for Q1 of FY 2022-23
- Clarification on mandatory furnishing of correct and proper information of inter-State supplies and amount of ineligible/blocked Input Tax Credit and reversal thereof in return in FORM GSTR-3B
- Exemption from filing annual return in FORM GSTR-9/9A for FY 2021-22 to be provided to taxpayers having AATO upto Rs. 2 crores.
- Explanation 1 after rule 43 of CGST Rules to be amended to provide that there is no requirement of reversal of input tax credit for exempted supply of Duty Credit Scrips by the exporters.
- UPI & IMPS to be provided as an additional mode for payment of Goods and Services Tax to taxpayers under Rule 87(3) of CGST Rules
- Supplies from Duty Free Shops (DFS) at international terminal to outgoing international passengers to be treated as exports by DFS and consequential refund benefit to be available to them on such supplies.
- Provision for automatic revocation of suspension of registration in cases where suspension of registration was done by the system under Rule 21A(2A) of CGST Rules, for non-compliance in terms of clause (b) or clause (c) of sub-section (2) of section 29[continuous non-filing of specified number of returns], once all the pending returns are filed on the portal by the taxpayer.
- Time period from 01.03.2020 to 28.02.2022 to be excluded from calculation of the limitation period for filing refund claim by an applicant
- Limitation under section 73 for FY 2017-18 for issuance of order in respect of other demands linked with due date of annual return, to be extended till 30th September, 2023.
The Council has decided to constitute a Group of Ministers to address various concerns raised by the States in relation to constitution of GST Appellate Tribunal and make recommendations for appropriate amendments in CGST Act.