FISME welcomes exemption to Small online businesses with sales below Rs 20 lakh from GST registration

New Delhi, June 30 (KNN) The GST Council on Wednesday decided to exempt small business selling products on e-commerce platforms from compulsory GST registration. 

It is applicable to those entities which have an annual turnover of up to Rs 20 lakh and those not making any inter-state taxable supply. 

The modifications will come into effect from January 1, 2023. 

The decision was made at the two-day 47th meeting of the GST Council chaired by Finance Minister Nirmala Sitharaman in Chandigarh on June 28-29. 

According to the official statement the Council has provided the “waiver of requirement of mandatory registration under section 24(ix) of CGST Act for person supplying goods through ECOs, subject to certain conditions, such as - a) the aggregate turnover on all India all basis does not exceed the turnover specified under sub-section (1) of Section 22 of the CGST Act and notifications issued thereunder; b) the person is not making any inter-state taxable supply.”

The Rs 40 lakh threshold exemption for intra-state sales bas also been extended by the Council providing major relief to MSMEs and enabling more sellers to make the shift from online to offline.

It has also extended the Rs 1.5-crore threshold under the composition scheme to online sellers. 

The Council on Wednesday also allowed composition taxpayers to make intra-state supply through e-commerce operators (ECOs). “The details of the scheme will be worked out by the Law Committee of the Council. 

The scheme would be tentatively implemented with effect from January 1, 2023, subject to preparedness on the portal as well as by ECOs," the statement added.

Composition dealers are those with a turnover of up to Rs 1.5 crore. They are required to pay GST at flat rates with input tax credit (ITC).  (KNN Bureau)