Businesses, with an annual turnover of up to Rs 40 lakh are exempted from GST
The Finance Ministry of the Government of India has declared in a series of statements that Businesses with an annual turnover of up to Rs 40 lakh will enjoy GST exemption. Previously the threshold limit was Rs 20 lakh.
During the commemoration ceremony of the first death anniversary of former Finance Minister Arun Jaitley, the Finance Ministry of GoI released a series of statements
- GST has reduced the tax rate as well as increased the number of taxpayers.
- The business with an annual turnover of up to Rs 40 lakh will be shifted under the GST exempt category.
- The organization with a turnover up to Rs. 1.5 crore can adopt the Composition Scheme and pay only 1% tax.
What are the other important announcements?
- Extension of reliefs for the construction sector.
- The housing sector has been shifted at the 5% tax slab.
- GST rate on affordable housing scheme has been cut down to 1%
- Out of 230 items in the 28% slab, which is the highest slab of GST and includes the luxury items, about 200 items have been relocated to lower slabs.
Goods and service tax
It is an indirect, multistage, destination-based tax, that is used on the supply of goods and services, that is collected from the point of consumption. GST ensures a seamless flow of tax credit, that eliminates the cascading effect of all indirect taxes in the supply chain starting from manufacturers to retailers, and also across the state borders.