GST Council Meeting: Services provided by Indian Railways like platform tickets exempted from GST, says FM

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Big decisions have been taken to clarify on GST Appellate Tribunal. Taxpayers have now only to pay a pre-deposit of 10% of the tax demand amount instead of 20% while filing of appeal before the GSTAT. For example, say the tax demand is Rs.10 Crores a pre-deposit of Rs.1 Crore is paid at the first stage of appeal and now only Rs. 1 Crores (and not Rs.2 Crore) needs to be paid at the GSTAT stage. This is a great relief for all appellants.
However, some State GST Departments had already recovered such 20% pre-deposit barring formation of the GSTAT. This should be now refunded to the appellants. Further, the uncertainty for taxpayers has been cleared that now they have to file the appeals before the GSTAT within three months from a “notified date”. Also, the GST department shall not file appeals before the GSTAT in case the matter involved is below Rs.20 Lakhs

The recommendation of GST Council to waive-off interest and penalty for notices issued without allegation of fraud, suppression etc, for FY 2017-18 to FY 2019-20, where taxpayer pays the full amount of tax demand on or before 31 March 2025 is a welcome move since there were many interpretation issues during the initial phase of GST where demands were raised during recent department audits or due to issuance of clarificatory circulars. Such waiver would also help in reducing the litigations for the various manual errors made during the initial periods.

The GST Council has recommended to exempt Accommodation Services having a value of supply up to Rs 20,000 per person per month. The condition for this is that these services are supplied for a minimum continuous period of 90 days. It’s primarily meant for students.

“Finance Act, 2022 had amended the time limit to avail Input Tax Credit for a financial year upto 30th November, of subsequent year. However, the said amendment was prospective. In a recent decision of Kerala High Court, the judiciary had held that the amendment is retrospective and hence the benefit will be available for the period from July 2017 onwards. The Council has considered the same and to close all pending issues and for the benefit of the trade clarified that the said time limit to avail Input Tax Credit is extended for all periods from July 2017 to March 21. Very beneficial amendment which will help clear a lot of pending issues and close litigations on the said time limit.”

A uniform rate of 5% IGST will apply to imports of ‘Parts, components, testing equipment, tools and tool-kits of aircrafts, irrespective of their HS classification to provide a fillip to MRO activities subject to specified conditions.

The Council recommended amendment in rule 142 of CGST Rules and issuance of a circular to prescribe a mechanism for adjustment of an amount paid in respect of a demand through FORM GST DRC-03 against the amount to be paid as pre-deposit for filing appeal.

The GST Council recommended to roll-out the biometric-based Aadhaar authentication of registration applicants on pan-India basis in a phased manner. This will strengthen the registration process in GST and will help in combating fraudulent input tax credit (ITC) claims made through fake invoices.

On the 53rd GST Council Meeting, Union Finance Minister Nirmala Sitharaman says "Bihar Deputy Chief Minister Samrat Choudhary has been made the Chairman of GoM of Rate Rationalisation. In the next meeting, Samrat Choudhary will submit a status quo report on the work done for the rate Rationalisation. After that, we will start work on start rate Rationalisation

CBIC Chairman: Corporate guarantee of 1% on 18% exempt for businesses where full ITC is available

The repayment of back to back GST loans to extend beyond March 31, 2025, but before March 31, 2026.States sought special package for Amravati, says FM

States sought increase interest free capex loan further. In interim budget it was raised to Rs 1.30 lakh crore, says FM

Assure GST assessees that govt working towards new compliance, says FM Sitharaman

1.96% of all active tax assessees have been sent tax notices from central gst till Dec 31, 2014. Only 114939 have received tax notices from Central GST says FM

The intent of Centre is clear to bring petrol, diesel under GST, no amendment needed for it. States need to come on board and decide the gst rate on fuel. GOM on rate rationalisation to give presentation in August gst council meet

Services provided by the Indian Railways to common man, sale of platform tickets, facility of retiring rooms and waiting rooms, battery operated car services are being exempted from GST. Further intra-railway supplies are also being exempted. The other, which is very important, service by way of hostel accommodation is presently not exempted, which are provided to students if they are outside of educational institutions. If they are within the educational institutions, then they are already exempted. Hostels which are for students which are within an educational institutions are already exempted. Now hostels which are for students but are not in an educational institutions are also getting exempted," said Union Finance Minister Nirmala Sitharaman, addressing a press conference after 53rd GST Council meeting.

FM Sitharaman said, "Council recommended to prescribe a uniform rate of 12% on all milk cans meaning steel, iron, aluminum which are irrespective of the use. They are called milk cans but wherever they are used that will be the rate applicable so that no disputes arise out of it.. The council also recommended to prescribe a uniform GST rate of 12% on all carton boxes and cases of both corrugated and non-corrugated paper or paper board. This will in particular help the apple growers of Himachal Pradesh, J&K.Council also clarified and recommended that the clarification be put out on that all types of sprinklers including fire water sprinklers will attract 12% GST."

Rate rationalisation GoM to submit status report in next meet. Deputy CM of Bihar to chair rate rationalisation GoM

Council recommended to prescribe uniform 12% rate on milk cans.
Council prescribed 12% rate on all carton boxes.
All types of sprinklers, including fire sprinklers will attract 12% rate.
All solar cookers will attract 12% GST rate.
Services provided by railways like battery operated vehicles, intra-railway services being exempt from GST.

There will be roll out of biometric authentication pan-India to check fake invoicing in a phased manner, says FM Nirmala Sitharaman

Max amount for filing of appeal shall be reduced from Rs 25 crore to Rs 20 crore CGST pre-deposit to file appeal before appellate authority. In order to help small taxpayers, Council recommended 30 June for GSTR4 for filing of returns for 2024-25

In order to reduce litigation, council recommended limit of Rs 1 crore for High Court and Rs 2 crore for Supreme Court for filing of appeal

For 2017-18, 2018-19, 2019-20 for demand notices, interest and penalty will be waived off if tax is paid by March 31, 2025, said FM Nirmala Sitharaman

It was decided to hold the next Council meeting in mid-August to discuss the remaining agenda, says FM Nirmala Sitharaman

There were lot of issues on agenda in GST Council, some could not be discussed because of paucity of time

Request to reduce GST on fertiliser will be sent to GoM on rate rationalisation by GST Council

On the GST Council meeting with Union Finance Minister Nirmala Sitharaman, Andhra Pradesh Finance Minister Payyavula Keshav said, "A lot of issues were discussed the whole day and in most of them, they were trying to clarify what has happened and were trying to make it a little easier and user friendly, business-friendly. They were trying to avoid all the future litigations.Post-budget session, there's likely to be another meeting. Most of the recommendations have been approved. Mostly a press note will be coming from the GST council. It was a very interesting and good discussion which took place."

According to sources, there will be changes in the GST law along the lines of Section 11A of Central Excise.

FM Nirmala Sitharaman to brief the media shortly on the outcome of 53rd GST Council meet

The briefing by the Finance Minister after the 53rd meeting of the GST Council has now been scheduled for 6 pm.

The 53rd meeting of the GST Council, chaired by Union Finance Minister Nirmala Sitharaman and comprising her state counterparts, is also likely to discuss the progress of the Group of Ministers (GoM) on finalising the report on Goods and Service Tax (GST) rate rationalisation and amendments to GST laws based on previous decisions of the council.

In the meeting, a proposal for exemption from GST on fertilizers can be sent to the GoM. Currently GST on fertilizer is 5 percent. The industry is demanding zero GST on fertiliser.

Union Finance Minister Nirmala Sitharaman chairs the 53rd meeting of the GST Council, at Bharat Mandapam, New Delhi, today.

Along with the Union Finance Minister, Chief Ministers of Goa and Meghalaya; Deputy Chief Ministers of Bihar, Haryana, Madhya Pradesh, and Odisha; besides Finance Ministers of States & UTs (with legislature) and Senior officers from Union Government & States are also attending the meeting.

The GST Council can recommend an exemption from IGST of 18% and 28% for a period of five years on the import of defence items. This exemption period is ending on June 30 this year.

Union Finance Minister Nirmala Sitharaman chairs the 53rd GST Council meeting, in Delhi

According to information received from sources by CNBC TV18, the GST Council may consider amending the GST Act to eliminate retrospective tax demands.

The GST Council meeting likely to focus on providing relief to traders. According to various reports a new category of form GSTR-1A can be introduced for changes or additions in GST return filing.

Discussions are underway regarding the inclusion of natural gas and ATF (Aviation Turbine Fuel) in GST, promising benefits for gas producers, marketers, and the entire petrochemical value chain, from polymers to plastics. ONGC, Oil India, Reliance, and city gas distribution firms stand to gain significantly from this potential policy change.

The 53rd GST Council meeting is scheduled for June 22, marking Finance Minister Nirmala Sitharaman's first chairmanship post the Modi 3.0 Cabinet's formation on June 10. Following recent elections, the BJP-led NDA Government aims to address key tax policy issues.

During the 52nd GST Council meeting, a significant proposal was put forth to promote the consumption of millets by recommending a 0% GST rate for millet food preparations. This exemption applied to millet flour in powdered form, provided that at least 70% of the flour by weight consisted of millets when sold loose. For pre-packaged items, the millet content needed to be at least 5%.

The Goods and Services Tax (GST) in India operates under a dual structure. The Central Government imposes Central GST (CGST), while State governments levy State GST (SGST) simultaneously on intra-state transactions. For interstate transactions and imports, Integrated GST (IGST) is applied, collected by the Central Government and later distributed to the destination state.

GST laws were implemented in India on July 1, 2017, replacing a labyrinthine network of Central and State taxes. The taxation framework categorizes goods and services into various tax slabs, from 5% to 28%, with exemptions for essential commodities and lower rates for activities like gold and diamond job work. Additionally, a compensation cess targets demerit goods and luxury items.

In May 2024, the Ministry of Finance reported significant GST collections with Central Goods and Services Tax (CGST) totaling Rs 32,409 crore and State Goods and Services Tax (SGST) amounting to Rs 40,265 crore. The Integrated Goods and Services Tax (IGST) reached Rs 87,781 crore, including Rs 39,879 crore from imported goods. For the fiscal year 2024-25 to date, CGST collections stand at Rs 76,255 crore and SGST at Rs 93,804 crore, reflecting ongoing revenue trends.

- GST on fertiliser firms: Discussions may focus on reducing GST on raw materials and nutrients to aid farmers and support fertiliser companies, following recommendations from the Standing Committee on Chemicals and Fertilisers earlier this year.

- Restructuring of rates: Concerns over inverted duty structures in sectors like pharma and textiles could lead to calls for restructuring. There's also anticipation for GST rate reductions to boost consumption and ease business pressures.

- 28% GST on Online Gaming: Despite appeals for relief, a review of the 28% GST rate on online gaming is unlikely to be considered in the meeting.

- Inclusion of fuel prices under GST: Long-standing demands to bring petrol and diesel under GST might not see progress, requiring unanimous consent from all states—an essential consideration.

Discussions are ongoing to integrate fuel into the GST framework, aiming for uniform pricing of vital energy resources. Yet, several states oppose, fearing revenue implications from potential tax adjustments.

The Finance Ministry will host the 53rd Goods and Services Tax (GST) Council Meeting in New Delhi today, chaired by Finance Minister Nirmala Sitharaman. The agenda remains undisclosed, but significant deliberations are anticipated after an eight-month hiatus since the last meeting in October 2023.

The GST Council is expected to consider tax relief for the import of maintenance, repair, and operations (MRO) services by foreign airlines at its meeting today. Currently taxed at 18%, these related party transactions face stringent compliance.

In today's meeting, the GST Council will deliberate on significant clarifications affecting the insurance industry. Reinsurance might be declared as not a supply of service, removing the 18% GST burden. The council will also clarify GST rules for co-insurance, where current practices have led to confusion and non-compliance.

The GST Council is expected to issue clarifications on the taxation of reinsurance and co-insurance in its meeting today. Reinsurance may be classified as not a supply of service, exempting it from the 18% GST. Additionally, the council will address GST applicability on co-insurance, a move prompted by industry practices and previous non-payment issues.

The online gaming sector, currently subject to a 28 percent GST on the full face value of bets, will not see the anticipated review at the GST Council meeting on June 22. Initially scheduled for review six months after the October 1, 2023 implementation, the discussion aimed to reassess the tax structure. Despite industry advocacy for GST to be levied on gross gaming revenue (GGR) instead of full face value, government officials indicate no review is needed as the industry has adjusted to the new regime.

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