37th GST Council Meeting
37th GST Council Meeting
On September 20, 2019, the Ministry of Finance (MoF) conducted the 37th GST Council Meeting in Goa. The meeting focused on recommendations to law and procedure. The agenda also included GST rates on goods, GST rate on services as well as corporate taxes for domestic companies. GST rates, ITC eligibility criteria, exemptions and clarifications were also discussed along with other areas.
The GST council meeting stated that all the recommendations would be implemented by October 1, 2019.
Changes to Procedures made on 37th GST Council Meeting
The recommendations and revisions are applicable to MSMEs for the FY 2017-18 and FY 2018-19
- Composition taxpayers are not required to file GSTR-9A for the mentioned periods
- Taxpayers who are required to file GSTR-9A with a turnover of Rs.2 crore shall be made optional
- A Committee of Officers will be constituted to examine and simplify the forms
- To furnish Form GSTR-3B and GSTR-1, new return system will be introduced by April 2020
- Procedure will be notified to claim a refund through Form GST RFD-01A
- Eligibility to NIL refund application through Form GST RFD-01A has been filed already
- As per Circular No.107/26/2019-GST dated on 18.07.2019, the supply of Information Technology enabled Services (ITeS services) shall be made on own account or through an intermediary
The relevant notification can be accessed below:
GST-Law & ProcedureGST Rate Changes – Services
The following are the reduced GST rates (sector-wise)
Hospitality and Tourism
|
S. No. |
Services |
Tariff Rates |
GST Rate |
|
1 |
Room tariff | less than Rs.1000 | No GST charges |
|
2 |
Room tariff | between Rs.1001 to Rs.7500 | 12% |
|
3 |
Room tariff | above Rs.7501 | 18% |
Catering Services
|
S. No. |
Services |
Tariff Rates |
GST Rate |
|
1 |
Catering services within the premises |
Daily tariff rate of Rs.7501 |
18% with ITC 5% without ITC |
|
2 |
Catering services other than the premises |
Daily tariff rate of Rs.7501 |
18% with ITC |
Job Work Service
|
S. No. |
Services |
GST Rate |
|
1 |
Supply of job work services related to diamonds |
1.5% (from 5%) |
|
2 |
Supply of machine job work services related to engineering industry (except bus bodybuilding) |
12% (from 18%) |
|
3 |
Supply of machine job work services related to engineering industry(except bus bodybuilding) |
18% |
GST Exemptions made on 37th GST Council Meeting
Warehousing
The following products stored at a warehouse or at storage units are exempted from GST as per the 37th GST Council Meet:
Products
- Cereals
- Pulses
- Fruits
- Nuts and vegetables
- Spices
- Copra
- Sugarcane
- Jaggery
Raw vegetable fibres
- Cotton
- Flax
- Jute
- Indigo
Unmanufactured products
- Tobacco
- Betel leaves
- Tendu leaves
- Rice
- Coffee and tea
Transportation
Conditional Exemption of GST on export freight by sea or air has been extended till 30.09.2020 (one more year).
Insurance
Bangla Shasya Bima (BSB): Farmers in West Bengal who have applied for BSB insurance scheme shall be exempted from GST charges.
Central Armed Paramilitary Forces: Life insurances provided to Central Armed Paramilitary Forces or to the family members under the group insurance schemes by Ministry of Home Affairs, shall be exempted from GST charges.
Export Promotion
If the services have been rendered or received for a supplier of goods by any intermediary, GST charges will be exempted if located outside the taxable territory.
IGST Act, Pharma: If the following R&D services provided by Indian Pharma companies to foreign companies shall be exempted from GST charges under Section 13(13) of IGST Act
- Integrated discovery and development
- Evaluation of the efficacy of new chemical or biological entities in animal models of disease
- Evaluation of the biological activity of novel chemical or biological entities in in-vitro assays
- Drug metabolism and pharmacokinetics of new chemical entities
- Safety Assessment/Toxicology
- Stability Studies
- Bio Equivalence and Bio Availability Studies
- Clinical trials
- Bioanalytical studies
IGST Act, Chip Design Software: R&D services provided for chip design software to foreign companies shall be exempted from GST charges under Section 13(13)(a) of IGST Act, 2017.
Other Exemptions
Registered authors can pay GST on the royalty amount claimed from the publishers. The GST can be filed under forwarding charge.
Granting liquor licence by State Governments as ‘no supply’
Service-related to FIFA Under-17 Women’s World Cup 2020
Rationalisation/Trade Facilitation Measures
Reverse Charge Mechanism: Security lending services can be filed at 18% under the reverse charge mechanism. For security lending services filed before the reverse charge mechanism, GST charges can be filed on a forward charge basis.
IGST will be applicable for services rendered and incase if CGST, SGST or UTGST has been paid, taxpayers are not required to pay again.
Services rendered by suppliers for body corporate entities on renting vehicles, a registered person other than LLP, proprietorship can avail 5% GST under reverse charge mechanism.
The relevant notification can be accessed below:
GST Rate on ServicesGST Rates Changes – Goods
| S. No. | Products | Reduced Rate | Original Rate |
| 1 | Slide Fasteners | 12% | 18% |
| 2 | Marine Fuel 0.5% (FO) | 5% | 18% |
| 3 | Wet Grinders (stone) | 5% | 12% |
| 4 | Dried tamarind | Nil | 5% |
| 5 | Plates and cups made by leaves, flowers and bark | Nil | 5% |
| 6 | Cut and Polished semi-polished stones | 0.25% | 3% |
GST rate of 5% is applicable on specified goods for petroleum operations under Hydrocarbon Exploration Licensing Policy (HELP).
Exemption of Goods from GST/IGST
- Specific defence products imported that is not being manufactured (up to 2024)
- Supply of products related to FIFA Women’s Football World Cup
- Supply of products related to Food and Agriculture Organisation (FAO)
Exemption of Goods from GST/IGST (Export Promotion)
- Imported Silver or Platinum by specified nominated agencies
- Silver or Platinum by specified nominated agencies for exports
- Diamond India Limited (DIL) will be included in the nominated agencies for IGST exemption and Nil GST rates on importing Gold, Silver or Platinum
GST rate of 12% from 5%, 12% and 18% will be applicable for the following products:
- Polypropylene/Polyethylene
- Woven and non-woven bags and sacks
- With or Without lamination (for packing goods)
Increased GST Rates
The following goods falling under chapter 86 shall have an increased GST rate from 5% to 12%
- Railway wagons
- Coaches
- Rolling Stocks (without accumulated ITC refund)
Caffeinated beverages will have an increased GST rate from 18% to 28% + 12% compensation cess
Concession for certain GST products
Exemption to Fish meal is applicable from 01.07.17 to 30.09.19. Although any tax collected during the period should be deposited.
Wheels, pulleys and other parts and used parts of agricultural machinery are exempted (falling under at the GST rate of 12% from 1.07.17 to 30.09.19)
- Passenger vehicles with 1500 cc diesel engine shall have 3% cess
- Passenger vehicles with 1200 cc petrol engine shall have 1% cess and
- Vehicles not exceeding 4000 mm (designed for 9 passengers) shall have 1% cess for petrol and 3% cess for diesel
Miscellaneous Charges
- Composition scheme will be implemented for Aerated drink manufacturers
- If the petroleum operations that are certified by the Director-General Hydrocarbon (DGH) as non-serviceable, the individual can file at the GST at the rate of 18% (if the GST paid was at 5%)
- Tobacco products will have restrictions on refunds for compensation cess (if it is inverted duty structure)
- Concession on spare parts imported temporarily to fix the airliner by a foreign airliner (in terms of Chicago Convention on Civil Aviation)
Clarifications
- Ingredients such as leguminous vegetables, products to soften or puff the skin and not subjected to other processing ingredients shall be classified under HS code 0713.
- GST rate of 12% will be implemented for mechanical sprayers under HS Code 8424
- GST rate of 5% will be implemented for solar-based devices such as solar water heater, solar stram, generation system
- Medical devices falling under HS code 9018, 9019, 9021 or 9022 will have a GST rate of 12%
- Almond milk will be classified under HS Code 22029990 with 18% GST
- Products imported for Navy shall be exempted from GST
The relevant notification can be accessed below:
GST Rate on Goods