The Cabinet of India has cleared the proposal of 46 amendments to be made to the GST laws, which will now be present to the Parliament for its approval. The GST Council had recommended as many as 46 changes in the present GST laws at its recent meeting on July 21.
The Cabinet, chaired by the Prime Minister, has cleared the changes on Wednesday so that it can now be placed in Parliament for the final consideration.
The amendments recommended by the Council included a few changes in the present laws of the Central GST, IGST and Compensation Cess, including a hike in the composition scheme registration threshold to 1.5 crores. The proposal will now be placed in the ongoing session of Parliament.
Once the proposal is approved by Parliament, it would be presented to the state legislatures for amendments in the State GST laws.
One of the recommended changes in the GST law will allow employers to claim ITC for expenses related to services like food, insurance and transport provided to employees. Other amendments include modification in reverse charge mechanism, cancellation of registration facility, consolidated debit/credit notes issuance for multiple invoices, separate registrations for different business verticals of a company, new return filing rules, etc.
As per new GST law amendment, e-commerce companies operating in India and having an annual turnover of below 20 lakh will not be required to seek GST registration and collect tax at source (TCS).
A major change has been recommended in the threshold limit for composition scheme registration. Once this comes into effect, businesses with a turnover of Rs 1.5 crore or less would be eligible for registering for the GST composition scheme, as opposed to the present threshold of Rs 1 crore. The composition scheme requires registered entities to pay GST at a fixed rate of 1 percent of their annual turnover and file quarterly returns. Over 17 lakh businesses are already registered under the GST composition scheme, as of now.