Nirmala Sitharaman
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Sitharaman had said in December that the budget will lay focus on higher spending to lay the foundation for stronger growth of an economy expected to con tract by about 7.7 per cent this fiscal

No late fee, half interest: GST Council on delayed filing of returns

In a relief to small taxpayers with turnover up to ₹5 crore, the GST Council on Friday (June 12) halved the interest on delayed filing of GST returns for February, March and April to 9 per cent, provided the returns are filed by September 2020.


In a relief to small taxpayers with turnover up to ₹5 crore, the GST Council on Friday (June 12) halved the interest on delayed filing of GST returns for February, March and April to 9 per cent, provided the returns are filed by September 2020.

Also, the deadline for filing returns for May, June and July has been extended till September, without any interest or late fee, Finance Minister Nirmala Sitharaman said after a meeting of the council.

Sitharaman said no late fee will be levied for delayed filing of GST returns by registered entities with nil liability between July 2017 to January 2020.

Briefing reporters after GST Council meeting, she said late fee for non-filing of monthly sales return for others has been reduced to a maximum of ₹500 for July 2017 to January 2020 period.

Related news: Govt unlikely to exempt GST on ventilators, PPEs, masks, test kits and sanitisers

The GST Council — the apex decision making body of the indirect tax regime — discussed the impact of COVID-19, she said.

Inverted duty structure hitting GST collections was discussed, she said, adding the panel was looking at correction of duty inversion in footwear, fertiliser, and textiles.

Sitharaman said discussion on taxing pan masala will hopefully be taken up at GST Council’s next regular meeting.

A special one-agenda meeting will happen in July to discuss compensation requirements of state, she added.

In the previous council meeting on March 14, 2020, Sitharaman had said that the Centre will look into the legality of GST Council borrowing from market to meet the compensation requirements.

Related news: Rahul Gandhi demands GST exemption on all COVID-19 related equipment

With states raising the issue of shortfall in compensation kitty, there were discussions on resorting to market borrowing to meet the revenue guarantee to states.

Under GST law, states were guaranteed to be paid for any loss of revenue in the first five years of the GST implementation from July 1, 2017. T

he shortfall is calculated assuming a 14 per cent annual growth in GST collections by states over the base year of 2015-16.

Under the GST structure, taxes are levied under 5, 12, 18 and 28 per cent slabs.

On top of the highest tax slab, a cess is levied on luxury, sin and demerit goods and the proceeds from the same are used to compensate states for any revenue loss.

(With inputs from agencies)

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