Finance Ministry Provides Relief, Says No GST For Businesses With Annual Turnover Of Rs 40 Lakh

The Finance Ministry in a series of tweet announced relief for business owners. According to a provision, businesses with Rs 40 Lakh annual turnover will be exempted from paying GST.

Finance Minister Nirmala Sitharaman. (File Photo/ Getty)

New Delhi: In a major relief to businesses struggling due to the lockdown and pandemic, the Ministry of Finance announced on Monday that businesses with an annual turnover of Rs 40 lakh have been exempted from the Goods and Services Tax (GST).  Earlier the GST exemption limit earlier was Rs 20 lakhs. Furthermore, businesses with a turnover up to Rs 1.5 crore can now opt for the Composition Scheme and pay only one percent tax. The Ministry informed the changes through a series of tweets. "Now, Businesses with an annual turnover of up to Rs 40 lakh are GST exempt. Initially, this limit was Rs 20 lakh. Additionally, those with a turnover up to Rs 1.5 crore can opt for the Composition Scheme and pay only 1% tax," said a tweet by the finance ministry. Several other significant reliefs have been provided to various sectors such as construction in which the housing sector has been placed at the 5 percent tax rate.

Now, Businesses with an annual turnover of up to Rs 40 lakh are GST exempt. Initially, this limit was Rs 20 lakh. Additionally, those with a turnover up to Rs 1.5 crore can opt for the Composition Scheme and pay only 1% tax. (1/5) pic.twitter.com/Jy589R1qNV

— Ministry of Finance (@FinMinIndia) August 24, 2020

'Once GST was implemented, the tax rate on a large number of items was brought down. As of now, the 28% rate is almost solely restricted to sin and luxury items. Out of a total of about 230 items in the 28% slab, about 200 items have been shifted to lower slabs," the Ministry of Finance said in a tweet. The Ministry also informed that since the introduction of the GST, the taxpayer base has almost doubled,  'The numbers of assessee covered by the GST at the time of its inception were about 65 lakh. Now the assessee base exceeds 1.24 crore.' Till now 50 crore returns have been filed online and 131 crore e-way bill generated said one of the tweet.