The GST Council is providing an alternative to the traders and businesses of all states regarding the threshold limit of GST. The business enterprises whose annual turnover is above Rs 40 lakh would be entitled to register under the goods and services tax, currently, it is Rs 20 lakh. It is not mandatory as the government seeks suggestions from different states about the 40 lakh annual turnover. It totally depends on the businesses choice if they want to retain to the current limit of Rs 20 lakh.
Kerala is one of the states which was demanding to raise the GST threshold limit for the traders and businesses. The state is mutually agreed with the Council decision and happily adopting Rs 40 lakh annual turnover limit for the registration of GST. The state had informed to the Council in the previous week that it is ready to start with a fresh look.
Punjab, which had been facing issues in the GST revenue collection till now that was incurred by the Union government under a Constitutional guarantee. Even after facing issues, the state has decided to opt Rs 40 lakh threshold limit. Previously, Punjab had issues to enhance the threshold limit of GST which was resultant to decline in tax collections as the central government was providing compensation to the different states which come to an end in 2022. In spite of all this, Punjab has decided to opt for Rs 40 lakh threshold limit under GST, as there sufficient time for the revenue collection, an anonymous said.
As per the official data, the Central Government provided over ₹4,600 crores to Punjab which was the second after the Karnataka ₹7,500 during the period of FY18. Now, states hope for an increase in revenues as now the administration has come forward to apply stricter norms and regulation for the GST.
All of the states must inform their suggestion/ Consensus to the Council regarding the higher Rs 40 lakh threshold limit of GST as soon as possible. Interestingly, the states which had adopted a lower threshold limit previously now moving to the higher threshold limit consensus making a significant feature to add up in the GST.
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Voting was conducted on 10th January during this month where the states were allowed to opt a suitable threshold limit as per their convenience. So far, the decisions have been taken by the Council is totally based on the consensus and Arun Jaitley do not want to break this.
