In a big relief to the small and medium sector , ahead of general elections , the GST council on Thursday decided to double the annual exemption turnover limit for business to rs 40 lakh. The exemption limit for the northeast and the hill states has been increased to Rs 20 lakh from the current 10 lakh per annum.
With this as many as 20 lakh micro small and medium enterprises will be able to get of the GST net. The revenue implication of all the decisions taken by the GST council on Thursday is likely to be around rs 3000 crore.
The GST council also decided to increase the turnover threshold for composition scheme under the GST to Rs 1.5 crore from Rs 1 crore . With the increase in threshold the small traders opening for the composition scheme will have a simpler compliance. Under this , traders and manufacturers have to file only one annual return while the tax compliance will be on quarterly basis . This will be applicable from April 1 2019 . Currently under composition scheme one needs to file quarterly returns as against monthly returns and tax to be filled in other businesses.
The traders , manufactures , restaurants, and services availing composition scheme have to pay tax at lower rate of 1 per cent , 5 per cent and 6 per cent respectivly. Small service providers, with a turnover of rs 50 lakh will now be eligible for the composition scheme.