Economics Current

42nd GST Council Meeting

The 42nd GST Council Meeting took place on 5th October, 2020 in New Delhi. The meeting was chaired by the finance minister Nirmala Sitharaman and the Minister of State (MoS) for Finance Anurag Thakur along with the presence of finance minister of all the states. The meeting approved extension of the GST compensation cess levy beyond 2022. The GST Compensation cess seeks to compensate the states for any loss in revenues in the first 5 years of the GST implementation, which was implemented in 2017. The GST Council is a constitutional body under Article 279A, and it provides recommendations to the Union and State Governments on GST related issues. Its recommendations are binding and all decisions are taken by 75% majority of members. 
The 42nd GST Council has recommended the following:
·Levy of Compensation Cess to be extended beyond the transition period of five years i.e. beyond June, 2022, to meet the revenue gap.
·Enhancement in features of return filing - GSTR1 and GSTR3B which is to be filed quarterly by the taxpayer whose turnover is less than Rs 5 crores from 1st January 2021, although challan is the medium by which payment is to be made.
·With a view to further enhance ease of doing business and improve the compliance experience, the Council has approved the future roadmap for return filing under GST. The approved framework aims to simplify filing and reduce the taxpayer’s compliance burden. 
·The assesse whose average turnover of higher than Rs. 5 Crores, Harmonised System Nomenclature (HSN) code needs to be written at a 6-digit level while HSN code to be mentioned at a 4-digit level for those whose average turnover is less than Rs. 5 Crores executing B2B supplies.
·From 1st January 2021, a refund will be given to those whose bank account validate with PAN and Aadhar. However, the application for refund can be signed via OTP of Aadar verification.
·Satellite launch services are to be released to support start-ups building satellites.

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