Relaxations in GST due to COVID-19 Pandemic announced by GST Council

On 28^th May, 2021, 43^rd meeting of GST Council took place in New Delhi which announced various relaxations in GST compliances looking into the present conditions due to COVID-19 pandemic. These relief measures are in addition to the relief measures already provided to the taxpayers vide the notifications issued on 01-05-2021. The following relaxations are being provided to the taxpayers:

Certain other COVID-19 related relaxations to be provided, such as:

• Extension of due date of filing GSTR-1/IFF for the month of May 2021 by 15 days
• Extension of due date of filing GSTR-4 for F.Y. 2020-21 to 31-07-2021
• Extension of due date of filing ITC-04 for quarter ending March 2021 to 30-06-2021
• Cumulative application of Rule 36(4) for availing ITC for tax periods of April, May and June 2021 in the return for the period June, 2021.
• Allowing filing of returns by companies using EVC instead of Digital Signature Certificate (DSC) till 31-08-2021.

Relaxations under section 168A of the CGST Act

Time limit for completion of various actions, by any authority or by an person under the GST Act, which falls during the period from 15^th April, 2021 to 29^th June, 2021, to be extended up to 30^th June, 2021, subject to some exceptions.

[Wherever the timelines for actions have been extended by the Hon’ble Supreme Court, the same would apply]

Relief in respect of Covid related goods

1. As a COVID-19 relief measure, a number of specified COVID-19 related goods such as medical oxygen, concentrators and other oxygen storage and transportation equipment, certain diagnostic marker test kits and COVID-19 vaccines etc., have been recommended for full exemption from IGST, even if imported on payment basis, for donating to the government or on recommendation of state authority to any relief agency. This exemption shall be valid upto 31-08-2021. Hitherto, IGST exemption was applicable only when these goods were imported "free of cost" for free distribution. The same will also be extended till 31-08-2021. It may be mentioned that these goods are already exempted from Basic Customs Duty. Further in view of rising Black Fungus cases, the above exemption from IGST has been extended to Amphotericin B.

2. As regards individual items, it was decided to constitute a Group of Ministers (GoM) to go into the need for further relief to COVID-19 related individual items immediately. The GoM shall give its report by 08-06-2021.

3. To support the Lympahtic Filarisis (an endemic) elimination programme being conducted in colloboration with WHO, the GST rate on Diethylcarbamazine (DEC) tablets have been recommended for reduction to 5% (from 12%).

Simplification of Annual Return for Financial Year 2020-21

• Amendments in Sectino 35 & 44 of CGST Act made through Finance Act, 2021 to be  notified. This would ease the compliance requirement in furnishing reconciliation statement in FORM GSTR-9C, as the taxpayers would be able to self-certify the reconciliation statement, instead of getting it certified by chartered accountants. This change will apply for Annual Return for F.Y. 2020-21.
• The Filing of annual return in FORM GSTR-9/ 9A for F.Y. 2020-21 to be optional for taxpayers having aggregate annual turnover upto Rs. 2 crores.
• The reconciliation statement in FORM GSTR-9C for the F.Y. 2020-21 will be required to be filed by taxpayers with annual aggregate turnover above Rs. 5 crores.

Interest payment on net cash basis

Retrospective amendment in section 50 of the CGST Act with effect from 01-07-2017, providing for payment of interest on net cash basis, to be notified at the earliest.

Clarificatory amendments:

• Leviability of IGST on repair value of goods re-imported after repairs
• GST rate of 12% to apply on parts of sprinklers/ drip irrigation systems falling under tariff heading 8424 (nozzles/ laterals) to apply even if these goods are sold separately.