Decisions Earlier Approved By The GST Council Now Made Effective

The GST council in its earlier meetings and the 38th meeting held on 18 December 2019 had approved several changes of GST provisions. Further, amendments in the CGST Act 2017 already passed by the Parliament were yet to be notified. The CBIC on 1 January 2020 issued notifications making several of these changes effective. Such changes along with other key updates are summarized below:

ITC restricted to 110% of invoices appearing in GSTR-2A (Effective 1 January 2020)

• In October 2019, the government had provided that the Input Tax Credit (ITC) with respect to invoices not reflecting in GSTR-2A would be capped at a maximum of 20% of the invoices reflecting in GSTR-2A.
• Vide Notification No. 75/2019 dated 26 December 2019, this cap has been reduced to 10% of ITC with respect to invoices appearing in GSTR-2A.