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July 1 2022, marks the completion of five years of India’s ambitious Goods and Services Tax (GST) law. The same week will also witness the 47th GST Council meeting scheduled at Chandigarh for two days- the 28th and 29th of June 2022.
Smt Nirmala Sitharaman will be chairing the meeting in the presence of the Minister of State for Finance and state ministers. It is expected to be a big meeting with many crucial matters, including possible modification of Form GSTR-3B and clarity on taxation of cryptocurrencies under GST.
The GST Council may propose changes to Form GSTR-3B and its reporting. The move aims to fasten the Input Tax Credit (ITC) settlement wherever genuine while curbing any fake ITC claims.
As per the sources, the revised GSTR-3B format would allow reporting of the gross ITC available for claims to the taxpayer, the ITC claimed during the tax period and the net ITC in the electronic credit ledger of the taxpayer.
The Group of Ministers (GoM) for GST rate rationalisation are expected to submit an interim report at the GST Council meeting. The report may propose corrective actions to address the inverted tax structure for some products such as writing, printing or drawing ink, LED lights, lamps and fixtures bearing tax rates from 12% to 18%. Whereas some rates may be increased from 12% to 18% for correction of inversion. The edible oil could not be allowed any accumulated ITC refund despite the inverted tax structure.
The GST Council plans to effectively clarify the taxation of cryptos under GST to track various digital asset transactions. Even though a GST rate may not be fixed in this meeting, exchanges and traders may get clarity on whether or not such crypto transactions could be placed in the highest slab of 28%. But the Fitment Committee desires to dig deeper into this matter and is therefore enquiring with the state governments of Karnataka and Haryana for an exhaustive paper for the GST charges on crypto activities.
According to the initial report of the GoM, which the chief minister of Karnataka leads, the GST Council’s choices should be carefully considered and sensitive to the general people’s needs, particularly when reducing the list of GST exemptions.
Until now, the Fitment Committee has rejected rate revision for the 113 commodities but accepted rate modifications for 14 goods and 22 services.
Bread, kitchenware, tractors, hearing aids, educational institutions, and incense sticks may receive a complete exemption. The exemption on products including honey, food grains, flattened rice, parched rice, puffed rice, cereals, jaggery, packaged curd, lassi, buttermilk, paneer, pappad, and some vegetables may be gradually removed by the Council.
Services provided by the IRDA to insurers, FSSAI to food business operators about registration, SEBI, and the RBI are among the things that may no longer be excluded from GST. The Fitment Committee has proposed that certain defence equipment imported by private parties for national defence purposes be free from basic customs duty and IGST.
The GST Council previously met for the 46th GST Council meeting on 31st December 2021.
