According to GST law, “aggregate turnover in GST” refers to the total value of all taxable supplies, exempt supplies, exports of goods or services or both, and inter-state supplies of persons with the same PAN calculated on an all-India basis, excluding Central tax, State tax, Union territory tax, Integrated tax, and cess.

Annual gross turnover is the total turnover computed for the entire financial year from April to March of the following year. In other words, it is the total of the following values when measured at the PAN level (all GSTINs combined). These values are as follows:

  • Taxable sales value
  • Exempt sales value
  • Export of goods and services
  • Interstate supplies by the company to its sister concern under the same PAN or interstate stock movement or supplies between distinct persons under the same PAN.

The above statistic, however, excludes tax components such as the Central tax, State tax, Union territory tax, Integrated tax, and Cess. Furthermore, the taxable value excludes transactions from which the customer is required to pay tax under the reverse charge scheme. It’s worth recalling that reverse charge transactions will also be counted as taxable supplies in gross turnover.

Meaning of Turnover in State

The concept of turnover in the state differs from that of aggregate turnover. It refers to the total amount of all taxable and non-taxable supplies, including exempt supplies and exports of goods and/or services made within a State by a taxable individual, as well as inter-state supplies of goods and/or services made from the State by the same taxable person, except taxes levied under the CGST Act, SGST Act, and IGST Act, as applicable.

In other words, the total turnover for a GSTIN at the state level, including any inter-state supplies that GSTIN makes.

Example for Normal Category States under GST

Here’s an example to help you understand the concept of aggregate turnover.

So Mr. A owns a tea estate that earns Rs.1.60 crore per year from the selling of tea leaves. This procedure is exempt from GST. Mr. A, on the other hand, uses plastic bags for his seed and charges an additional fee for them. His plastic bag sales produce Rs. 5 lakhs in revenue, and we know that this trade (sale of plastic bags) is subject to GST. In other words, his net income is just Rs. 5 lakhs.

According to the rule of aggregate turnover, Mr. A is required to register for GST because his aggregate turnover crosses the Rs. 40 lakh threshold limit. Mr. A is therefore unable to file as a composition dealer because his gross income reaches the Rs.1.5 crore limit (Rs 75 lakhs for special category states).

Example for Special Category States Under GST

Below is the list of states which are assigned special status under Goods and Services Tax Law:

  • Arunachal Pradesh
  • Assam
  • Jammu & Kashmir
  • Manipur
  • Meghalaya
  • Mizoram
  • Nagaland
  • Sikkim
  • Tripura
  • Himachal Pradesh
  • Uttarakhand

For all of the above states, the aggregate turnover threshold has been set at Rs. 10 lakh. As a result, the same example will apply, but the numbers will be changed.

Assume that Mr. B, a farmer in Nagaland, has a revenue of Rs. 15 lakh from agriculture. The selling of plastic bags generates just Rs. 50,000 in taxable income for him. Mr. B will also be required to register for GST because his total revenue exceeds the Rs. 10 lakh threshold for special category states.

The Government may increase the aggregate turnover referred to in the law from ten lakh rupees to such level, not exceeding twenty lakh rupees, and subject to such conditions and limitations as may be specified in the CGST (Amendment) Act, 2018, at the request of a special category State and on the Council’s recommendations.

As a result, as of January 1, 2019, the threshold cap for Jammu and Kashmir, Arunachal Pradesh, Assam, Himachal Pradesh, Meghalaya, Sikkim, and Uttarakhand remains Rs.20 lakhs, and Rs.10 lakhs for Manipur, Mizoram, Nagaland, and Tripura.

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