<p>The GST Council on Friday gave some relief to businesses by waiving late fees on filing returns and reducing interest on late payment but a discussion on the most contentious issue of compensation cess to states was deferred to next month, when a decision may be taken on borrowing from the market to compensate states.</p>.<p>The Friday’s meeting waived late fees on registered businesses with nil Goods and Services Tax (GST) return filing and who have not filed their returns between July 2017 and January 2020.</p>.<p>For those who have a tax liability, the maximum late fee for non-filing of GST returns for period July 2017 to January 2020 has been capped at Rs 500. This will apply to all returns submitted between July and September.</p>.<p>After chairing the 40th GST Council meeting through video-conferencing, Finance Minister Nirmala Sitharaman also announced that small taxpayers with turnover up to Rs 5 crore will now pay a reduced rate of interest of 9% from 18% for returns filed for February-April 2020, if filed by September 30.</p>.<p>“In July,which is on the request of all the ministers, there shall be a meeting to discuss exclusively one agenda point - compensation cess. The compensation which has to be given to the states & if at all it results in some kinds of borrowing, how & who is going to pay for it,” said Sitharaman.</p>.<p>Kerala Finance Minister Thomas Isaac, however, said that ballooning of fund required for GST compensation and drastic shrinkage of cess collection after Covid have aggravated the payment crisis. The only solution for the GST Council was to borrow funds and extend Cess period by a year or two.</p>.<p>The Centre has released Rs 36,400 crore to states as compensation cess from December to February period.</p>.<p>Running short of revenues, the Council did not discuss rate cut on any items, although there was a demand from across the sectors. A discussion on rectifying the inverted duty structure on footwear, fertilizer and other things came up for discussion.</p>.<p>Sitharaman said Uttar Pradesh wanted to take a call on brick klins and pan masala. This will be taken up in the next GST Council meeting.</p>
<p>The GST Council on Friday gave some relief to businesses by waiving late fees on filing returns and reducing interest on late payment but a discussion on the most contentious issue of compensation cess to states was deferred to next month, when a decision may be taken on borrowing from the market to compensate states.</p>.<p>The Friday’s meeting waived late fees on registered businesses with nil Goods and Services Tax (GST) return filing and who have not filed their returns between July 2017 and January 2020.</p>.<p>For those who have a tax liability, the maximum late fee for non-filing of GST returns for period July 2017 to January 2020 has been capped at Rs 500. This will apply to all returns submitted between July and September.</p>.<p>After chairing the 40th GST Council meeting through video-conferencing, Finance Minister Nirmala Sitharaman also announced that small taxpayers with turnover up to Rs 5 crore will now pay a reduced rate of interest of 9% from 18% for returns filed for February-April 2020, if filed by September 30.</p>.<p>“In July,which is on the request of all the ministers, there shall be a meeting to discuss exclusively one agenda point - compensation cess. The compensation which has to be given to the states & if at all it results in some kinds of borrowing, how & who is going to pay for it,” said Sitharaman.</p>.<p>Kerala Finance Minister Thomas Isaac, however, said that ballooning of fund required for GST compensation and drastic shrinkage of cess collection after Covid have aggravated the payment crisis. The only solution for the GST Council was to borrow funds and extend Cess period by a year or two.</p>.<p>The Centre has released Rs 36,400 crore to states as compensation cess from December to February period.</p>.<p>Running short of revenues, the Council did not discuss rate cut on any items, although there was a demand from across the sectors. A discussion on rectifying the inverted duty structure on footwear, fertilizer and other things came up for discussion.</p>.<p>Sitharaman said Uttar Pradesh wanted to take a call on brick klins and pan masala. This will be taken up in the next GST Council meeting.</p>
