The 54th meeting of the GST Council took some major decisions on reducing taxes on certain essential items, while taxes on a couple of items has been hiked. The GST Council, comprising the Union Finance Minister and representatives from all States and Union Territories, was established in 2017, to make decisions on various aspects of GST, including tax rates, exemptions, and administrative procedures.
GST on cancer drugs
The GST Council has decided to reduce tax rate on cancer drugs — Trastuzumab Deruxtecan, Osimertinib and Durvalumab from 12 per cent to 5 per cent, certain categories of namkeen to 12 per cent, from 18 per cent.
GST on car seats
GST rate on car seats has been increased from 18 per cent to 28 per cent. This uniform rate of 28 per cent will be applicable prospectively for car seats of motor cars in order to bring parity with seats of motorcycles which already attract a GST rate of 28 per cent.
GST on helicopters passengers transport
The Council also decided there will be 5 per cent GST on transport of passengers by helicopters on seat share basis and 18 per cent on the charter of a helicopter.
GST on flying training courses
Also, flying training courses conducted by DGCA-approved Flying Training Organizations (FTOs) have been exempted from GST.
GST on namkeens and savoury items
The GST rate of extruded or expanded products, savoury or salted (other than un-fried or un-cooked snack pellets, by whatever name called, manufactured through process of extrusion), falling under HS 1905 90 30 to be reduced from 18% to 12% at par with namkeens, bhujia, mixture, chabena (pre-packaged and labelled) and similar edible preparations in ready for consumption form which are classifiable under HS 2106 90. The GST rate of 5% will continue on un-fried or un-cooked snack pellets, by whatever name called, manufactured through process of extrusion.
To also clarify that the reduced GST rate of 12% on extruded or expanded products, savoury or salted (other than un-fried or un-cooked snack pellets, by whatever name called, manufactured through process of extrusion), falling under HS 1905 90 30 is applicable prospectively.
GST on Universities and R&D
Universities and research centers that have been established by a law of the Central Government; or established by a law of the State Governments; or that have obtained income tax exemption can receive research funds both from the government and from the private and they would not be subjected to GST payments. The GST Council, in its meeting on Monday, decided that they are exempt from paying the GST.
Meanwhile, the GST Council will take a call on reducing tax rate on premiums of health and life insurance policies at its next meeting in November. Briefing reporters on decisions taken in the 54th meeting of the GST Council held on Monday, Union Finance Minister Nirmala Sitharaman said a Group of Ministers will be constituted to look into the GST on premiums of life and health insurance policies.
Metal Scrap
Reverse Charge Mechanism (RCM) to be introduced on supply of metal scrap by unregistered person to registered person provided that the supplier shall take registration as and when it crosses threshold limit and the recipient who is liable to pay under RCM shall pay tax even if supplier is under threshold. A TDS of 2% will be applicable on supply of metal scrap by registered person in B to B supply.
Roof Mounted Package Unit (RMPU) Air Conditioning Machines for Railways
Roof Mounted Package Unit (RMPU) Air Conditioning Machines for Railways would be classified under HSN 8415 attracting a GST rate of 28%.
Before July 1, 2017, the indirect tax regime was highly fragmented. The Centre and States were separately taxing goods and services. Over the years, GST has, among others, simplified compliance and reduced the cascading impact of tax.
