Threshold Limits and Exemptions | GST India

As per the federal structure in India, there are two components of goods & services tax India – Central GST (CGST ) and State GST (SGST). Both Centre and the  State would levy goods & services tax across the value chain, where tax will be levied on every supply of goods and services.

A uniform threshold limit for both CGST and SGST across states with dealers having annual aggregate turnover of supply of all goods and services less than Rs.10 lakh being exempted from the purview of both CGST and SGST. Goods & Services Tax India laws including threshold limit, exemptions are being worked upon and concerned groups are finalizing the principles and laws.

Principles on threshold limit

  • Threshold limit of gross annual turnover of Rs.10 lakh both for goods and services for all the States and Union Territories be specified.
  • Further, composition scheme for small scale traders and industries under GST should be with an upper ceiling on Rs. 50 lakh gross annual turnover and a floor tax rate of 0.5% across all States.

Objectives of threshold limit

  • Reduce cost of administering of large numbers of small taxpayers
  • Relive small taxpayers from compliance cost and compliance administration
  • Give advantage to small taxpayers over large enterprises on account of lower tax incidence.


GST Tutorial IndexBack to GST Tutorial Main Page