The Governor of Bihar notified the Bihar Goods and Services Tax (Seventh Amendment) Rules, 2020. The Amendment was notified on 10th August, 2020. The new Rules amend the Bihar Goods and Services Tax Rules, 2017. The Amendment comes into force from the 1st April, 2020.
The Amendment makes changes to Rules 7 of the Bihar GST Rules, 2017 which deals with the rate of tax of the composition levy. The Amendment introduces a new category of registered persons, namely registered persons not eligible for the composition levy under sub-sections (1) and (2), but eligible to opt to pay tax under sub-section (2A), of section 10. In the case of such persons, the rate of tax is fixed at 3% of the turnover of supplies of goods and services in the State.
Section 10 (2A) stipulates that a registered person who is ineligible for composition levy under sub-section (1) and (2) and whose aggregate turnover in the preceding financial year was not more than Rs. 50 lakh can pay an amount of tax not more than 3%. However, such a person must not be:
- Engaged in making any supply of goods or services which are not leviable to tax;
- Engaged in making any inter-state outward supplies of goods or services;
- Engaged in making any supplies of goods or services, through an electronic commerce operator, who is required to collect tax at source under section 52;
- Manufacturer of such goods or supplier of such services, notified by the Government;
- A casual taxable person or a non-resident taxable person.
Additionally, if multiple registered persons possess the same PAN, a single person cannot opt for this scheme unless all such persons also opt for it.
Furthermore, as far as the rate of tax is concerned, while the percentages remain unchanged, the Amendment eliminates the option of rates based on the percentage of turnover in the Union Territory. In other words, the rate of tax is determined solely on turnover in the State.
