Union Finance Minister Nirmala Sitharaman with Revenue Secretary Sanjay Malhotra during the 54th GST Council Meeting, at Sushma Swaraj Bhawan, in New Delhi on Monday (September 9, 2024). | Photo Credit: ANI
The 54th GST Council meeting on Monday (September 9, 2024) chaired by Finance Minister Nirmala Sitharaman took several decisions, including two status reports submitted.
Mrs. Sitharaman announced the formation of a Group of Ministers (GoM) to review the 18% GST levy on insurance. “We have told them to report by the end of October and the GST Council will meet in November and finalize the decision based on the GoM’s recommendations,” he said. .
The GST Council, headed by Ms. Sitharaman and including the Minister of State, are expected to decide whether to reduce the tax burden on health insurance from the current 18% or exempt certain categories of individuals, such as senior citizens. However, the announcement was postponed to the next meeting. Mrs. Sitharaman said, “The Board felt it might be worth GoM to examine this issue quickly and the November GST Board can take the call.”
Many Resident Welfare Associations are asking if they are signing up for group coverage, and we need to think about life insurance and term insurance, he said.
The tariff rationalization GoM presented the details of what has happened so far and asked for a meeting on September 23. The GoM on real estate also submitted a status report. Then the status of casinos, online games and horse racing GST levy, also presented to the Council.
Mrs. Sitharaman said the revenue from online games has increased by 412% and has reached ₹6,909 crore in just six months.
Also, the revenue from the casino increased by 30% to ₹ 214 crore in the six months after GST was reported, he added.
Compensation GST Ces
Ms. Sitharaman said that we have discussed the Suspension of GST Compensation which can be implemented till March 2026 as per the extended period. “Perhaps, in January 2026, we will clear the loan and the interest due for the loan made to compensate the country during the period of COVID.”
“To determine what to do after March 2026 with the levy of Compensation Cess, we have agreed to form a GoM that will study the compensation claims of each state. It will also decide what to do with Cess after March 2026,” he said.
The Finance Minister said that a Committee of Secretaries has also been formed to decide on how to implement the Integrated GST. “Today, we have a negative balance in IGST. To decide the way forward, a committee headed by the Additional Revenue Secretary will be set up with Central and State officials,” he told the Council.
Much of the balance should be recovered from states that have received excess IGST, he said.
Ms. Sitharaman said that there was a request from the Finance Minister of Karnataka that the formulation and modus operandi of IGST calculation could be explained again to anyone who wanted it. The Revenue Secretary will hold an informal virtual meeting with the desired Minister.
Some of these committees are given very limited time. The IGST panel should also return by the end of October, he added.
The Council decided that the funds allocated for research to the universities linked to the state, which are already under the law of the State or Central, or which have obtained an exemption from Income Tax, can receive research funds from the public (government) and private sectors and will be exempted from paying GST, said Ms. Sitharaman.
Reduced GST rates on certain cancer drugs
Mrs. Sitharaman on Monday announced a reduction in GST rates for specified cancer drugs. “You will recall that we have reduced the excise duty and now the GST rate has been reduced from 12% to 5% to reduce the cost of cancer treatment,” he said.
The GST rate is being reduced prospectively from 18% to 12% in namkeens, he said.
Revenue Secretary Sanjay Malhotra said government school boards in the United States and those under the Center are exempted from GST.
There is a decision to lease commercial property by an unregistered person to a registered person under the reverse charge mechanism. This has been the case for residential properties, so this anomaly has been rectified, the Revenue Secretary said.
There is a clarification on the place of supply in relation to advertising services delivered by an Indian entity to a foreign company. It is clarified that the place of the foreign entity will be treated as the place of supply and therefore, GST will be exempted, said Mr. Malhotra.
Mr. Malhotra said a clarification will also be issued for the availability of input tax credits for vehicle dealers for demo vehicles provided by car manufacturers. E-invoicing will be introduced for B2C transactions to enable customers to assess if they have the original product, but this will be voluntary in some countries and sectors to start, he said.
The GST rate for car and motorcycle seats will be raised from 18% to 28% prospectively. It has also decided to notify 5% GST for transport services using helicopters with shared seats, as well as for air travel according to economy class.
Mr. Malhotra said that a decision has been taken to exempt the import of services by foreign airlines. He told the Council that he had been given some news.
The council also decided to manage the past tense (demands) on an ‘as is where they are’ basis, he added.
Published – 09 September 2024 19:25 IST
