GST - Current Affairs Questions and Answers

1)   The Union Cabinet approved setting up of which apex body under Goods and Services Tax (GST) regime so as to ensure the benefit of tax reaches consumers?

a. National Good and Services Authority
b. National GST Tax Authority
c. National Anti-profiteering Authority
d. National Anti-laundering Authority
Answer  Explanation 

ANSWER: National Anti-profiteering Authority

Explanation:
The Union Cabinet approved setting up of National Anti-Profiteering Authority (NAA), an apex body with an overarching mandate under Goods and Services Tax (GST) regime so as to ensure the benefit of tax reaches consumers.

It also approved creation of posts of Chairman and Technical Members of National Anti-profiteering Authority (NAA) under GST regime.

NAA: Know More

  • The establishment of the NAA, to be headed by a senior officer of the level of Secretary to the Government of India with four Technical Members from the Centre and/or the States.
  • It is one more measure aimed at reassuring consumers that Government is fully committed to take all possible steps to ensure the benefits of implementation of GST in terms of lower prices of the goods and services reach them.
  • It may be recalled that effective from midnight of 14th November, 2017 the GST rate has been slashed from 28% to 18% on goods falling under 178 headings.
  • There are now only 50 items which attract the GST rate of 28%.
    Likewise, a large number of items have witnessed a reduction in GST rates from 18% to 12% and so on and some goods have been completely exempt from GST.
  • The "anti-profiteering" measures enshrined in the GST law provide an institutional mechanism to ensure that the full benefits of input tax credits and reduced GST rates on supply of goods or services flow to the consumers.
  • This institutional framework comprises the NAA, a Standing Committee, Screening Committees in every State and the Directorate General of Safeguards in the Central Board of Excise & Customs (CBEC).


2)   GST Council took a slew of decisions during the 23rd meeting including which of the following:

a. Rate cuts for consumers
b. Reduction of tax on restaurants
c. Businesses to benefit from compliance norm easing
d. Only a and c
e. All of the above
Answer  Explanation 

ANSWER: All of the above

Explanation:
The Goods and Services Tax Council took a slew of decisions during its 23rd meeting in Guwahati on Friday to benefit consumers and businesses alike.

While consumers will stand to benefit from a number of rate cuts, including the tax on restaurants, businesses stand to benefit from a significant easing of compliance norms to do with filing returns.

Up to November 15, when the decisions take effect, the GST system requires businesses to submit at least three forms to file their returns.

The GSTR-1 dealt with the invoice-wise details of supply, GSTR-2 dealt with the receipts of goods, and GSTR-3 was an overall summary derived from the two previous forms.

Now, the GST Council has decided that, in order to ease the compliance burden on businesses, companies would be allowed to only file the GSTR-1 form, up to March 31, 2018.

The Council has set up a committee to look into how to make the GSTR-2 form easier, following which it will be brought back into the system.

The Council also decided to extend the usage of the summary GSTR-3B form, meant to make life easier for those unfamiliar with the filing process, till March 31 from the earlier December 31 deadline.

Companies with a turnover of up to र1.5 crore a year will now be able to file their GSTR-1 forms for each month in a quarterly manner.

Companies earning र1.5 crore or more a year can file their July to October forms by December 31.

Not only did the latest Council meeting ease the deadlines, but it also slashed the penalties for filing late.

For companies with nil tax liability for a particular month, the penalty for delays has been cut to र20 per day from र200 per day. All other companies will have to file a penalty of र50 per day, down from र200 per day.

The GST Council - the apex body for decision making headed by finance minister Arun Jaitley - also decided to impose a uniform GST rate of 5 percent across all categories of standalone restaurants - air-conditioned and non-air-conditioned - but withdraw the benefits of input tax credit (ITC) from such businesses.

Restaurants in starred hotels and outdoor catering services will attract a GST of 18 percent along with ITC benefits.

Composition Scheme

  • The annual turnover threshold on the composition scheme will be raised from Rs 1 crore to Rs 1.5 crore.
  • This will be done after the law is amended to raise the turnover ceiling for eligibility of composition.
  • The law will be amended to raise the ceiling to Rs 2 crore. The limit will be raised immediately after the law amended to Rs 1.5 crore
  • Under the scheme, traders, manufacturers and restaurants can pay tax at 1, 2 and 5 percent, respectively.
  • The council has also decided to fix a uniform rate of 1 percent for traders and manufacturers.
  • The move to widen the turnover threshold is aimed at easing the compliance burden for taxpayers as they will have to file returns only once in a quarter as against monthly returns that needs to be filed by other normal taxpayers.
  • However, dealers cannot avail input tax credit, unlike a normal taxpayer.
  • Also, traders availing the composition scheme on goods, who also provide small services upto Rs 5 lakh annually, will not be considered ineligible for the scheme.
  • GST, billed as the country's biggest indirect tax overhaul, has consolidated a dozen of state and central duties into one single levy.
  • ll goods and services have been fitted into four broad slab structure - 5, 12, 18 and 28 percent -along with a cess on luxury and demerit goods such as tobacco, pan masala and aerated drinks.


3)   GST Council is set to liberalise which scheme for small business owners to pay flat tax on turnover?

a. Composition scheme
b. Operation scheme
c. Tax liability scheme
d. Both a and c
Answer  Explanation 

ANSWER: Both a and c

Explanation:
The twenty-third meeting of the Goods and Services Tax (GST) Council in Guwahati on Friday is set to tighten the noose on players who, authorities believe, have started splitting their business operations into smaller entities to avoid higher tax liabilities.

The Council is also set to cut tax rates on a large number of product lines.

The Council is expected to further liberalise the Composition Scheme for small businesses and traders to pay a flat and low tax on their turnover.

The annual turnover eligibility threshold is likely to be raised to ₹1.5 crore from the ₹1 crore limit, imposed at the Council's October meeting.

However, the government is concerned about the emergence of a parallel economy despite the restrictions on the Composition Scheme, whose original threshold limit was just ₹75 lakh a year.

Small States may have legitimate concerns, but the restriction on inter-State supplies by businesses under the Composition Scheme could also fuel the prospects for more informal trade outside the tax net.

The GoM has not been able to arrive at a consensus on the question of whether supplies from small firms that are part of the Composition Scheme should translate into input tax credits for larger firms who buy from them.


4)   Which trader's body saw its secretary general included in the GST panel?

a. CAIT
b. ASSOCHAM
c. FICCI
d. ISMA
Answer  Explanation 

ANSWER: CAIT

Explanation:
Traders body CAIT's Secretary General Praveen Khandelwal has been nominated to be a part of the government's GST panel.

The panel -- which has been constituted with approval of Union Finance Minister Arun Jaitley -- includes other members like Araghya Sengupta (Research Director, Centre for Legal Policy), Vinod Jain (CA), Anuj Sahai (CEO of Federation of Indian Exporters Organisation) and Laghu Udyog Bharti President Om Prakash Mittal, CAIT said in a statement.

Gautam Ray, retired chief commissioner of Central Board of Direct Taxes, has been named as the convenor.

The group will discuss possible changes in GST law and its rules and will submit its recommendations to Law Review Committee by November 30.

The first meeting of the group has been convened on November 8 to discuss in-depth the GST law and rules and amendments needed to make compliance easier.


5)   Union Cabinet has given an approval for ordinance to amend which GST legislation?

a. Goods and Services Tax (Compensation to States) Act 2017
b. Goods and Services Tax (Assistance to States) Act 2017
c. Goods and Services Tax (Support to States) Act 2017
d. Goods and Services Tax (Legislation for States) Act 2017
Answer  Explanation 

ANSWER: Goods and Services Tax (Compensation to States) Act 2017

Explanation:
The Union Cabinet chaired by Prime Minister Shri Narendra Modi has given its approval to the proposal of the Finance Ministry to promulgate an ordinance to suitably amend the Goods and Services Tax (Compensation to States) Act, 2017.

The approval would allow to increase the maximum rate at which the Compensation Cess can be levied from 15% to 25% on:

a. motor vehicles for transport of not more than thirteen persons, including the driver [falling under sub-headings 870210, 8702 20, 8702 30 or 8702 90]; and

b. motor vehicles falling under headings 8703.

The GST Council, in its meeting held in August 2017, taking into consideration the fact that post introduction of GST, the total incidence on motor vehicles [GST+ Compensation Cess] has come down vis-a-vis pre-GST total tax, incidence.

It had recommended increase in the maximum rate at which Compensation Cess can be levied on motor vehicles falling under headings 8702 and 8703 from 15% to 25%.

The issue regarding the increase in effective rate of Compensation Cess on motor vehicles will be examined by the GST Council in due course.


6)   Case Study on birth of which tax system in India was launched by the FM on 25th July 2017?

a. Indirect Tax
b. Direct Tax
c. Sales Tax
d. None of the above
Answer  Explanation 

ANSWER: None of the above

Explanation:
A Case Study on the birth of the Goods and Services Tax (GST) in India – “The GST Saga: A Story of Extraordinary National Ambition” was released on 25th July 2017 by the Union Finance Minister, Shri Arun Jaitley in his office in North Block in the national capital.

In view of the successful roll-out of the GST on 1 July 2017, it was felt that there was a need for the public to know of the story of how GST evolved, its timeline, the different stakeholders involved and how it eventually culminated in its inauguration in the Central Hall of the Parliament of India on the midnight of 30th June,2017 and 1st July, 2017 by the President and Prime Minister of India.

This case study accordingly captures the entire journey of GST right from its ideation in the Kelkar Task Force Report in 2003.

Other salient features such as the dates on which the SGST Laws were enacted in the 31 States, peculiarity of the Indian GST model, how the fitment of rates was done and the IT backbone of GST have also been addressed in the case study.

This makes it a concise yet comprehensive repository of the GST story.


7)   GoI has launched which app to verify tax rate on commodities and services under GST?

a. GST Rates Finder
b. GST Rates Searcher
c. GST Rates Revealer
d. GST Rates Locator
Answer  Explanation 

ANSWER: GST Rates Finder

Explanation:
Government has launched an App - GST Rates Finder to verify the accurate tax rate on commodity and services under the Goods and Services Tax (GST) regime.

This will empower not only the taxpayers, but every citizen of the nation, to ascertain the correct GST rate on goods and services.

Through this app, user can determine GST rate by entering the name of the commodity or service.

The search result will list all the Goods and Services containing the name which was typed in the search box.

A taxpayer can search for applicable CGST, SGST, UTGST rate and Compensation Cess on a supply.

Finance Ministry said, this mobile app can be downloaded on any smart phone and can work in offline mode, once downloaded.

The application has been launched on Android platform, and will soon be available on iOS platform.

Central Board of Excise and Customs (CBEC) has taken these initiatives for ease of doing business under the GST regime.

CBEC has also provided a GST rate finder on its portal - cbec-gst.gov.in to help taxpayers know applicable GST rate on their supplies.


8)   President of India promulgated two ordinances for which state to join GST?

a. Mizoram
b. Manipur
c. J&K
d. HP
Answer  Explanation 

ANSWER: J&K

Explanation:
The President of India has promulgated today two ordinances, namely, the Central Goods and Services Tax (Extension to Jammu and Kashmir) Ordinance, 2017 and the Integrated Goods and Services Tax (Extension to Jammu and Kashmir) Ordinance, 2017.

This was for extending the domain of Central GST Act and the Integrated GST Act to the State of Jammu and Kashmir, with effect from 8th July, 2017.

With this, the State of Jammu and Kashmir has become part of the GST regime, making GST truly a “one nation, one tax” regime.

Earlier, the Goods and Services Tax was launched in the country from the midnight of 1st July, 2017.

However, because of the special provisions applicable to the State of Jammu and Kashmir extra steps had to be taken before the State could join the GST fold.

On 6th July 2017, the State of Jammu and Kashmir had taken the first step towards adopting the GST regime with the President of India giving assent to the Constitution (Application to Jammu and Kashmir) Amendment Order, 2017.

Resultantly, the One Hundred and First Amendment Act, 2016 to the Constitution of India that paved the way for introduction of GST in the country, became applicable to the State of Jammu and Kashmir also.

Following this, on 7th July, 2017, the Jammu and Kashmir Goods and Services Tax Bill, 2017 was passed by the State Legislature, empowering the State to levy State GST on intra-state supplies with effect from 8th July, 2017.

Concomitantly, the President of India has promulgated two ordinances, namely, the Central Goods and Services Tax (Extension to Jammu and Kashmir) Ordinance, 2017 and the Integrated Goods and Services Tax (Extension to Jammu and Kashmir) Ordinance, 2017.


9)   When are traders exempt from GST registration?

a. When annual turnover is more than 20 lakhs and does not involve interstate supply
b. When annual turnover is less than 20 lakhs and does not involve interstate supply
c. When annual turnover is more than 15 lakhs and does involve interstate supply
d. When annual turnover is more than 13 lakhs and does involve interstate supply
Answer  Explanation 

ANSWER: When annual turnover is less than 20 lakhs and does not involve interstate supply

Explanation:
The government on July 6, 2017 conducted the first GST "masterclass" for all stakeholders including citizens.

These "masterclasses" are in the form of hour-long programs and will be held for six days.

Here are key takeaways from the first GST masterclass:

1) Registration on GST portal:

The government clarified that it is mandatory for the traders and dealers to complete the Part-B of their GST registration within the period of 90 days.

If an individual is not hands-on with online registration, then she/he can visit any excise, VAT or Service Tax office of state and central government where officials will get the job done.

There is no charge involved in this process.

Responding to a query on problems regarding registration of names bearing special characters (e.g. D'Souza or L&T), the government said that the software of the GST portal has been fixed to overcome the hiccup.

2) Updating details after registration:

The GST masterclass also discussed the updation of details of a business in the GST portal.

The government said that for minor details like bank account number, phone number, e-mail ID, updation can be done by the trader herself/ himself by visiting the GST registration portal.

However, modification like change in legal name of business, address of place of business, addition or deletion of partners or directors etc. can be done only by tax officials.

3) Exemption on turnover of INR 20 lakh

Trader class by now are well-versed with the fact that they are exempt from GST registration if their annual turnover is less than Rs 20 lakh.

However, the GST Council officials clarified that if a business involves inter-state supply, then GST registration is mandatory even if the turnover is below the threshold.

However, it was pointed out that if a business has a turnover below INR 20 lakh currently and happens to cross the threshold over time, then it needs to get itself registered within 30 days of it.

4) Items outside GST purview:

The Revenue Secretary on Wednesday reiterated the items which are outside the ambit of GST.

Following is the list of such products and the competent authority which can charge tax on them:

  • 5 petroleum commodities- VAT can be levied by state government while excise duty by the centre government
  • Stamp duty and registration charges- By state government
  • Vehicle Tax- By state government
  • Electricity Duty- By state government
  • Potable alcohol- By state government
  • Entertainment Tax- By state government in order to benefit local bodies
5) Miscellaneous
  • The provisional ID number received at the time of registration will be the same as the ID number received at the completion of registration.
  • All registered dealers will have to furnish their GSTN registration numbers on signboards.
  • In case, a dealer is facing problems in uploading Digital Signature Certificate (DSC), he/she can also opt to authenticate using an OTP (One Time Password) sent to his/her mobile number and e-mail ID.


10)   What rates are the 4 slab service tax structures proposed by the GST council?

a. 5,12,18,28
b. 6,13,19, 29
c. 7, 14, 20, 30
d. None of the above
Answer  Explanation 

ANSWER: 5,12,18,28

Explanation:
The GST Council headed by finance Minister Arun Jaitley has finalised a 4-slab service tax structure at the rates of 5, 12, 18 and 28 per cent as against the single rate of 15% levied on all taxable services.

GST regime is scheduled to be implemented from July 1.

In the next GST Council meeting, tax rates on gold and other precious metals will be taken up for discussion.

Luxury hotels, gambling, race club betting and cinema services will attract a tax rate of 28%.

Education, healthcare and non-AC rail travel will remain exempted from the GST tax regime.

However, the states will be given the option to levy additional taxes on cinema to compensate for the revenue losses entailed due to merging of entertainment tax with GST.

At present, the total tax incidence on cinema including entertainment and 4-slab service tax is in the range of 55%.

The states need to use the legislative route if it wants to levy additional tax on cinema. States will also be permitted to levy any new tax as the taxation powers of the states have only been restricted and not abolished after the rollout of GST.

Telecom and financial services will be taxed at a rate of 18%. Transport services will be taxed at the rate of 5%.

Cab aggregators like Ola and Uber will have to pay 5% under GST in place of 6%. AC rail travel will attract 5% tax. Economy class air travel will attract 5% GST while business class will attract 12%.

Travelling on metro, local train and religious travel such as Haj Yatra would be exempted from GST.

The e-commerce players like Flipkart and Snapdeal would be required to shell out 1% Tax Collected at Source (TCS).

Non-AC restaurants and AC restaurants will attract a GST of 12% and 18% respectively.

Advertisements published in newspapers will attract 5% GST. At present it is exempt from 4-slab service tax.

GST Council: Know More

  • ST Council is a federal forum with both centre and states in India on board formed in September 2016.
  • It is made of: The Union Finance Minister (as Chairman), The Union Minister of State in charge of Revenue or Finance, and The Minister in charge of Finance or Taxation or any other Minister, nominated by each state government.
  • The decisions of the GST Council are made by three-fourth majority of the votes cast. The centre has one-third of the votes cast, and the states together have two-third of the votes cast.
  • Each state has one vote, irrespective of its size or population.
  • The Secretary (Revenue) will be appointed as the Ex-officio Secretary to the GST Council. The Chairperson, Central Board of Excise and Customs (CBEC), will be included as a permanent invitee (non-voting) to all proceedings of the GST Council.
  • One post of Additional Secretary to the GST Council in the GST Council Secretariat (at the level of Additional Secretary to the Government of India) will be created.
  • Four posts of Commissioner in the GST Council Secretariat (at the level of Joint Secretary to the Government of India) will also be created.


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