The following changes were recommended in the Composition Scheme on the basis of discussions held in the 23rd meeting of the GST Council held at Guwahati today.
i. Uniform rate of tax @ 1% under composition scheme for manufacturers and traders (for traders, turnover will be counted only for supply of taxable goods). No change for composition scheme for restaurant.
ii. Supply of services by Composition taxpayer upto Rs 5 lakh per annum will be allowed by exempting the same.
Suppose :A person is dealing in computer parts and giving some minor repair service wants to take composition scheme .At present he can not avail composition scheme as he is providing service also but now it is proposed that if person is proving services can avail composition scheme and service provided up to 5 lakh /annum then service part will be exempted from GST
iii. Annual turnover eligibility for composition scheme will be increased to Rs 2 crore from the present limit of Rupees 1 crore under the law. Thereafter, eligibility for composition will be increased to Rs. 1.5 Crore per annum.
iv. The changes recommended by GST Council at (ii) and (iii) above will be implemented only after the necessary amendment of the CGST Act and SGST Acts.
v. GST under composition scheme will be required to be paid only on taxable goods for traders and not on total turnover.However to calculate upper ceiling of One crore or 1.5 crore ,total turnover is to be considered.