Indian economy is a matter of big debate among experts, politicians and other stakeholders. Much of ammunition to the critical evaluation of progress and likely course of direction is being provided by the past ministers in the NDA government including Yashwant Sinha and more recently Arun Shourie. In a way its good news for masses that well ahead of general election in 2019, economic development has become the hot topic for debate. This means that both the ruling party to retain power or the other faction to come to power with or without a Maha Gathbandan (Grand Coalition Alliance) will work out innovative and progressive measures for the Indian economy.
In the meantime, Prime Minister, Narendra Modi, while addressing the Company Secretaries at the inauguration of the Golden Jubilee Year of ICSI – the Institute of Company Secretaries of India said that there are a few people in our country who attempt to weaken the honesty of our social structures, and lower the nation’s dignity. He said that the Government is working towards cleansing the system of such elements.
The Prime Minister said that as a result of the efforts of the Government, the economy is functioning with less cash. The cash to GDP ratio has come down to 9 per cent, from 12 per cent before demonetisation. The Prime Minister cautioned against people who only wish to spread a feeling of pessimism.
The Prime Minister recounted instances in the past when the growth rate had fallen below 5.7 per cent, witnessed in the last quarter. He said that low growth rates, on those occasions, had been accompanied by higher Inflation, higher Current Account Deficit and higher Fiscal Deficit. The Prime Minister said that there was a time when India was considered to be part of the Fragile Five economies, which were dragging back global recovery.
Further, acknowledging the decline in growth in the previous quarter, the Prime Minister said that the Government is committed to reversing this trend. He said several important reform related decisions have been taken and this process will continue. He asserted that the country’s financial stability will be maintained. He assured the gathering that the steps taken by the Government will take the country to a new league of development in the years to come. He said that a premium would be placed on honesty, and the interests of the honest would be protected.
The Prime Minister outlined the massive increase in investment and outlays in some key sectors over the last three years. He said that 87 reforms have been carried out in 21 sectors in this period. He presented figures to show the quantum jump in investment. The Prime Minister said that in the policy and planning of the Government, care is being taken to ensure that savings accrue to the poor and the middle class, even as their lives change for the better.
The Prime Minister asserted that as he works to empower the people and the nation, even though he faces criticism on some occasions, he cannot mortgage the country’s future, for his own present. On the said occasion, the Prime Minister congratulated all those associated with ICSI. He said he is happy to be among those who are responsible for ensuring that companies follow the law, and maintain their accounts properly. He said their work helps establish the country’s corporate culture. Their advice has a bearing on the country’s corporate governance, he added.
News Update| FM at GST Council’s 22nd Meeting announced measures to ease the burden of compliance on small and medium businesses
The GST Council, in its 22nd Meeting held on 6 October 2017 in the national capital under Chairmanship of the Union Minister of Finance and Corporate Affairs, Arun Jaitley has recommended the following facilitative changes to ease the burden of compliance on small and medium businesses:
- The composition scheme shall be made available to taxpayers having annual aggregate turnover of up to Rs. 1 crore as compared to the current turnover threshold of Rs. 75 lacs. This threshold of turnover for special category States, except Jammu & Kashmir and Uttarakhand, shall be increased to Rs. 75 lacs from Rs. 50 lacs.The turnover threshold for Jammu & Kashmir and Uttarakhand shall be Rs. 1 crore. The facility of availing composition under the increased threshold shall be available to both migrated and new taxpayers up to 31.03.2018. The option once exercised shall become operational from the first day of the month immediately succeeding the month in which the option to avail the composition scheme is exercised. New entrants to this scheme shall have to file the return in FORM GSTR-4 only for that portion of the quarter from when the scheme becomes operational and shall file returns as a normal taxpayer for the preceding tax period. The increase in the turnover threshold will make it possible for greater number of taxpayers to avail the benefit of easier compliance under the composition scheme and is expected to greatly benefit the MSME sector.
- Persons who are otherwise eligible for composition scheme but are providing any exempt service (such as extending deposits to banks for which interest is being received) were being considered ineligible for the said scheme. It has been decided that such persons who are otherwise eligible for availing the composition scheme and are providing any exempt service, shall be eligible for the composition scheme.
- A Group of Ministers (GoM) shall be constituted to examine measures to make the composition scheme more attractive.
Relief for Small and Medium Enterprises
- Presently, anyone making inter-state taxable supplies, except inter-State job worker, is compulsorily required to register, irrespective of turnover. It has now been decided to exempt those service providers whose annual aggregate turnover is less than Rs. 20 lacs (Rs. 10 lacs in special category states except J & K) from obtaining registration even if they are making inter-State taxable supplies of services. This measure is expected to significantly reduce the compliance cost of small service providers.
- To facilitate the ease of payment and return filing for small and medium businesses with annual aggregate turnover up to Rs. 1.5 crores, it has been decided that such taxpayers shall be required to file quarterly returns in FORM GSTR-1,2 & 3 and pay taxesonly on a quarterly basis, starting from the Third Quarter of this Financial Year i.e. October-December, 2017. The registered buyers from such small taxpayers would be eligible to avail ITC on a monthly basis. The due dates for filing the quarterly returns for such taxpayers shall be announced in due course. Meanwhile, all taxpayers will be required to file FORM GSTR-3B on a monthly basis till December, 2017. All taxpayers are also required to file FORM GSTR-1, 2 & 3 for the months of July, August and September, 2017. Due dates for filing the returns for the month of July, 2017 have already been announced. The due dates for the months of August and September, 2017 will be announced in due course.
- The reverse charge mechanism under sub-section (4) of section 9 of the CGST Act, 2017 and under sub-section (4) of section 5 of the IGST Act, 2017 shall be suspended till 31.03.2018 and will be reviewed by a committee of experts. This will benefit small businesses and substantially reduce compliance costs.
- The requirement to pay GST on advances received is also proving to be burdensome for small dealers and manufacturers. In order to mitigate their inconvenience on this account, it has been decided that taxpayers having annual aggregate turnover up to Rs. 1.5 crores shall not be required to pay GST at the time of receipt of advances on account of supply of goods. The GST on such supplies shall be payable only when the supply of goods is made.
- It has come to light that Goods Transport Agencies (GTAs) are not willing to provide services to unregistered persons. In order to remove the hardship being faced by small unregistered businesses on this account, the services provided by a GTA to an unregistered person shall be exempted from GST.
Other Facilitation Measures
- After assessing the readiness of the trade, industry and Government departments, it has been decided that registration and operationalization of TDS/TCS provisions shall be postponed till 31.03.2018.
- The e-way bill system shall be introduced in a staggered manner with effect from 01.01.2018 and shall be rolled out nationwide with effect from 01.04.2018. This isin order to give trade and industry more time to acclimatize itself with the GST regime.
- The last date for filing the return in FORM GSTR-4 by a taxpayer under composition scheme for the quarter July-September, 2017 shall be extended to 15.11.2017. Also, the last date for filing the return in FORM GSTR-6 by an input service distributor for the months of July, August and September, 2017 shall be extended to 15.11.2017.
- Invoice Rules are being modified to provide relief to certain classes of registered persons.