The tax department has extended by three months till July 31 the deadline for service providers with turnover of up to Rs 50 lakh to opt for the composition scheme and pay six per cent goods and services tax (GST).

The GST Council, chaired by Finance Minister and comprising state counterparts, has permitted such service providers to opt for composition scheme and pay taxes at reduced rate of six per cent beginning April 1, 2019

This is against the higher rates of 12 and 18 per cent levied for most services under GST.

In a circular, the Central Board of Indirect Taxes and Customs (CBIC) said suppliers who want to opt for composition scheme would have to file Form GST CMP-02 by selecting ‘any other supplier eligible for composition levy’ latest by July 31, 2019.

The CBIC had earlier marked April 30, 2019, as the deadline for service providers to opt for the scheme.

The GST composition scheme was so far available to traders and manufacturers of goods with an annual turnover of up to Rs 1 crore. This threshold too has been increased to Rs 1.5 crore from April 1.

Under the scheme, traders and manufacturers are required to pay only one per cent GST on goods which otherwise attract a higher levy of either 5, 12 or 18 per cent. Such dealers are also not permitted to charge GST from the customers. Of the 1.22 crore businesses registered under GST, about 17.5 lakh have so far opted for the composition scheme.

Source : Financial Express