Page 45 - Banking Finance June 2017

ARTICLE

15. For eleven Special Category States, like those in the Accounts would be settled periodically between the Cen-
North-East and the hilly States, the exemption thresh- tre and the States to ensure that the SGST/UTGST por-
old shall be Rest. 10 lakhs. tion of IGST is transferred to the Destination State where
the goods or services are actually consumed.
16. All taxpayers eligible for threshold exemption will have
the option of paying tax with input tax creit (ITC) ben- 19. Use of Input Tax Credit: Taxpayers shall be allowed to
efits. Taxpayers making inter-State supplies or paying take credit of taxes paid on inputs (input tax credit) and
tax on reverse charge basis shall not be eligible for utilize the same for payment of output tax. However,
threshold exemption. no input tax credit on account of CGST shall be utilized
towards payment of SGST/UTGST and vice versa. The
17. Composition Scheme: Composition scheme is optional.
Small taxpayers with an aggregate turnover in a finan- credit of IGST would be permitted to be utilized for
cial year up to Rest. 50 laks shall be eligible for compo- payment of IGST, CGST and SGST/UTGST in that order.
sition levy. Under the scheme, a taxpayer shall pay tax 20. HSN (Harmonized System of Nomenclature) code shall
as a percentage of his turnover during the year with- be used for classifying the goods under the GST regime.
out the benefit of ITC. The rate of tax for CGST and Taxpayers whose turnover is above Rs. 1.5 crore but
SGST/UTGST each shall not exceed below Rs. 5 crore shall use 2-digit code and the taxpay-
Y 2.5% in case of restaurants etc ers whose turnover is Rs. 5 crore and above shall use 4-
digit code. Taxpayers whose turnover is below Rs. 1.5
Y 1% of the turnover in a state/ UT in case of a manu-
facturer crore are not required to mention HSN Code in their
invoices.
Y 0.5% of the turnover in state/UT in case of other
21. Exports and supplies to SEZ shall be treated as zero-
suppliers.
rated supplies. The exporter shall have an option to
A taxpayer opting for composition levy shall not collect either pay output tax and claim its refund or export
any tax from his customers nor shall he be entitled to under bond without tax and claim refund of Input Tax
claim any input tax credit. Taxpayers making inter-State Credit.
supplies shall not be eligible for composition scheme.
The government, may, on the recommendation of GST 22. Import of goods and services would be treated as in-
ter-State supplies and would be subject to IGST in addi-
Council, increase the threshold for the scheme up to
tion to the applicable customs duties.
rupees one crore.
18. An Integrated tax (IGST) would be levied and collected In the next issue we will discuss about special benefits and
by the Centre on inter-State supply of goods and services. problems in the ensuing GST Regime. T

ICAI urged FinMin to conduct special audit on demonetization
ICAI requested the Finance Ministry and the Reserve Bank of India to allow its members to undertake focused "special
audit" of deposit flowing into the banking system during demonetization period. There is a need to assess the demon-
etization impact at each of the bank branches vis-à-vis the RBI circulars on this issue and gauge the extent of compli-
ance, Nilesh Vikamsey, President, Institute of Chartered Accountants of India (ICAI), said.
Cabinet approves listing of 11 PSUs

The Cabinet Committee on Economic Affairs approved listing of 11 public sector undertakings, including five railway
subsidiaries including Ircon International, Indian Railway Catering and Tourism Corporation (IRCTC), Rail Vikas Nigam,
Indian Railway Finance Corporation (IRFC) and RITES Ltd. The Department of Public Asset Management (DIPAM) has
initiated the process to fix a consultant for the listing of these two firms.
Currency appreciation erodes margins of textile exporters

The rupee has appreciated more than five per cent against the US dollar in 2017, much more than some of its compet-
ing currencies. In a four-part series, Business Standard looks at the impact of a strong rupee on India's key export-
oriented sectors, starting with textiles and apparel.

BANKING FINANCE | JUNE | 2017 | 45

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