Arun Jaitley  (PTI)
Arun Jaitley (PTI)

FinMin notifies April 1 as date for availing increased GST exemption limit, composition scheme

  • The effective date for availing higher turnover cap of 1.5 cr for availing composition scheme by traders has also been fixed as 1 Apr
  • The decisions were taken by the GST Council, chaired by FM Arun Jaitley and comprising his state counterparts, on 10 January

NEW DELHI: The government Thursday notified 1 April as the date for the implementation of doubling of GST exemption limit to 40 lakh, which will benefit small and medium enterprises.

Besides, the effective date for availing higher turnover cap of 1.5 crore for availing composition scheme by traders has also been fixed as 1 April.

Also, service providers and suppliers of both goods and services with a turnover of up to 50 lakh would be eligible to opt for the GST composition scheme and pay a tax of 6% from the beginning of next fiscal.

These decisions were taken by the GST Council, chaired by Finance Minister Arun Jaitley and comprising his state counterparts, on 10 January. These decisions would come into effect from 1 April, a finance ministry statement said.

"There would be two threshold limits for exemption from registration and payment of GST for the Suppliers of Goods i.e. 40 lakhs and 20 lakhs. States would have an option to decide about one of the limits.

"The Threshold for Registration for service providers would continue to be 20 lakhs and in case of Special Category States 10 lakhs," it said.

Also the GST Composition Scheme, under which small traders and businesses pay a 1% tax based on turnover, can be availed by businesses with a turnover of 1.5 crore, against the earlier 1 crore, with effect from 1 April.

EY India Tax Partner Abhishek Jain said implementation of these proposals with specifically the higher turnover limit for composition schemes, would aid enhancing the ease of doing business for MSMEs.

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