Centre Against Low GST Threshold; Wants A Fresh Look

NEW DELHI: The Centre is against keeping the threshold limit at Rs 10 lakh for levying GST and wants the committee on dual control to take a final view on the matter after detailed discussions.

The Centre in a communication to the state Finance Ministers has suggested that the meeting of the Committee on Dual Control, Threshold and Exemptions be convened at the earliest for "detailed discussion and analysis" of the issues concerning the threshold limit.

It has argued that the limit be kept high as the cost of collection of revenues from small traders and dealers is disproportionately high as compared to the revenue collected from them.

Quoting an analysis, the Centre said: "States are collecting just 2 per cent of their revenue from traders/ dealers having their annual turnover between Rs 10 lakh and Rs 25 lakh, while this group comprises nearly 60 per cent of all their tax payers."

Moreover, it added, keeping the threshold limit at Rs 10 lakh would mean that any dealer with a daily turnover of Rs 2,800 would come under the GST net.

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