GST Amendments 2019

Is Reverse Charge Mechanism back in force? Will GST threshold limit be doubled in the new fiscal year 2019-20? Read to find out …

Is Reverse Charge really back?

CGST (Amendment) Act 2018 has come in force from 1st February 2019 and Section 9 of CGST has been amended to provide that tax shall be liable to be paid under Reverse Charge Mechanism (RCM) by specified class of persons on supply of specified categories of goods or services received from un-registered persons.

Thus, provisions of RCM u/s 9(4) will be applicable ONLY after the Government will notify: a) The specific category of registered persons on whom it will be applicable; b) The specific category of supply of goods or services on which it intends to make it applicable.

It is not certain when and whom government will notify as specified persons and which supply of goods or services will be notified to be covered under RCM.

Thus as of the moment RCM is back, but, only on paper.

GST registration threshold proposed to be doubled

GST Council in its 32nd meeting held on 10th January 2019 has recommended increase in the GST registration threshold for supply of goods from Rs 20 lakh to Rs 40 lakh with effect from 1-4-2019. This threshold will also be doubled for the special category States from Rs. 10 lakh to Rs 20 lakh.

However, the threshold has been doubled only for “supply of goods” and not for “services. In other words, the threshold limit for services will remain at Rs. 20 Lakhs.

Further, states have been given powers for choosing if they want to sustain the threshold exemption at Rs 20 Lakh or Rs 40 Lakh.

 

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