Finance minsiters Panel recommends overhaul of Composite scheme

New Delhi, Oct 30: A panel of state finance ministers formed to review changes in the Goods and service tax (GST) has submitted its report and suggested some changes. These can be accepted by the council in next meeting which would be held on Nov 9 in Guwahati.The panel has suggested that

# A 12 % tax rate for all restaurants whether Air Conditioned or otherwise (earlier 18 % tax for Ac restaurants).However, Input tax credit cannot be claimed by restaurants.

Currently, people can choose composite scheme if their annual turnover is in between Rs 20 lakh and RS 1 crore.

# The composition scheme has also been simplified
people can pay 0.5 % tax for total turnover (including revenue from the sale of exempted goods).

# Traders can pay 1 % if they segregate income from the non-exempted products will have to pay 1% tax on the sale of non exempted goods.

# The tax rate on restaurants and manufactures under the composite scheme may also pay 1 % tax.

# The composition scheme can be extended to interstate sales.

# Manufacturers who depend on job works can also utilise composition scheme.

# 18 % tax rate for hotels whose rent is above RS 7500 and no distinction for 5-star hotels.