The GST Council decided to increase its maximum exemption limit from Rs. 20 Lakh to Rs. 40 Lakh. This decision was made in the 32nd council meeting. As of now, a large number of SMEs will be able to avail the benefits of this new rule of GST meaning that they will have to pay taxes only when their revenue cross a higher threshold.

This new higher limit will bring GST benefit for a large number of SMEs and MSMEs all across the country. These businesses will be able to reap GST benefits and enjoy higher revenues during operations. The new limit applies on sale of all goods.

However, doubling the exemption limit may also impact the revenues collected. There are several factors applicable to the new limit of Rs. 40 Lakh. It will introduce new rules to calculate taxes, limit for turnovers, new registration policies for specific circumstances and mandatory tax paying if the council regards the business as eligible. Here’s the advantages and disadvantages of GST for startups.

A business owner has to be aware of the conditions as well as everything businesses need to know about GST to file his or her returns accurately and on time. The decision to increase the upper limit will help taxpayers step out of the tax net.