August 2017

Decisions taken by the Government in 20th meeting of the GST Council1

The GST Council, in its 20th meeting, decided on the following issues:
E-way bill: The Council approved the e-way bill rules and decided to implement e-way bill system across
the country. The Finance Minister (FM) mentioned in the press conference that e-way bill will not be needed
for supply of exempted goods or for a supply within city within 10 km distance. The date from which the e-
way bill provisions will come into effect is not yet decided. It was also mentioned that there would not be any
check posts and the process would be technology driven with very limited human intervention. Only the
consignments with value above INR 50,000/- would be required to comply with e-way bill provisions.
Anti-profiteering: There was significant discussion on anti-profiteering rules and on the practices by the
trade. Screening committee for Central and State Governments is proposed to be set up in the next 15 days.
The FM made an appeal to the industry to pass on the benefits of the input tax credit (ITC).
GST rate on services: The rate of tax for 19 services have been realigned. The rate of tax for some goods
has also been realigned. While the notifications mentioning the specific changes in the rates have not yet
been released in the public domain, some of the changes in rates announced by the FM are as under:
Job work across textile sector would be subject to tax @ 5%, instead of present multiple rate structure,
depending on the activity.
Parts of tractors, which can be used with only tractors would be subject to tax @ 18%, instead of 28%.
Works contracts awarded by Government have been reduced from 18% to 12%. ITC would be eligible on
such works contracts.
The procurements for the Junior FIFA cup have been exempted from GST.
Amendment to Rules: Some of the rules have been amended. The revised rules have not yet been released
in public domain (at the time of preparing this flash).
The next meeting of the GST Council will be held at Hyderabad on 09 September 2017.

PwC comments
The GST Council has been meeting regularly to decide on a number of critical issues. As expected, the e-way Bill
rules have been approved, though the date from which they will become effective is yet to be announced.
Exemption from e-way bill for exempted products or for transportation within 10 km provides great relief to the
industry. In such cases, there is lack of clarity as to whether other transport documents including copy of the
invoice or bill of supply would suffice.
The rate changes are welcome and would reduce the issues relating to inverted duty structure and classification
in the sector. On anti-profiteering, industry is eagerly expecting clear guidelines for the methodology and
implementation of the provisions.
The next meeting on 09 September 2017 is important as reduction in rate of tax on several other items
recommended by the fitment committee would be discussed and decided.

1
This flash has been prepared on the basis of the press conference addressed by the FM after the meeting of the GST Council.
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PwC TRS Team

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