Moving towards rolling out GST from 1st April 2017, GST council in its first meeting has agreed to an exemption limit of Rs 20 lakhs. For North East states and hill areas the limit is set at Rs 10 lakhs.
For small traders with annual turnover less than 1.5 crore, the council decided that the state authorities will have jurisdiction over such assesses. For assessees with turnover more than 1.5 crore the Centre will have the jurisdiction. There would be cross examination either by officers from the Centre or state to avoid dual control.
However, the Central Government will continue exercise control over all the existing 11 lakh service tax assessees who are already registered irrespective of their turnover level. New assessees which would be added to the list would be divided between the Centre and states.
The base year has for calculating the compensation loss of revenue to the states has been agreed as financial year 2015-2016 and the average of the last 5 years will be taken. The compensation methodology will be worked out in the next meeting of the council.
The council will finalise the draft rules on implementing exemptions in its next meeting on September 30. However GST rate and the tax slabs will be decided in meeting to be held on October 17.