GST Council: Used cars, caramel popcorn becomes costlier; rice, pepper cheaper
From reducing the GST rate on fortified rice kernel (FRK) to fully exempt GST on gene therapy, the 55th GST Council meeting, chaired by Union Finance Minister Nirmala Sitharaman, on Saturday made some key recommendations to provide relief to individuals and businesses.
The Council recommended exemption of GST on contributions by general insurance companies from third-party motor vehicle premiums for Motor Vehicle Accident Fund.
It also recommended no GST on transaction of vouchers as they are neither supply of goods nor supply of services. The provisions related to vouchers is also being simplified.
What gets cheaper?
- GST Council clarified that no GST is payable on ‘penal charges’ levied and collected by banks and NBFCs from borrowers for non-compliance with loan terms.
- Reduction of payment of pre-deposit for filing an appeal before the Appellate Authority in respect of an order passed which involves only a penalty amount.
- Reduction in the GST rate on fortified rice kernel (FRK), classifiable under 1904, to 5%, as the commodity is supplied to the weaker sections of society through the public distribution system (PDS). Pepper, whether fresh green or dried pepper and raisins when supplied by an agriculturist, is not liable to GST.
- Rate of Compensation Cess to 0.1% on supplies to merchant exporters at par with GST rate on such supplies and exempt from IGST imports of all equipment and consumable samples by the Inspection Team of the International Atomic Energy Agency (IAEA) subject to specified conditions.
What becomes expensive?
- Increase in GST rate from 12% to 18% on sale of all old and used vehicles, including EVs other than those specified at 18 per cent like sale of old and used petrol vehicles of engine capacity of 1200 cc or more and of length of 4000 mm or more; diesel vehicles of engine capacity of 1500 cc or more and of length of 4000 mm and SUVs.
- It also clarified that ready-to-eat popcorn which is mixed with salt and spices are classifiable and attracts 5% GST, if supplied as other than pre-packaged and labelled, and 12% GST if supplied as pre-packaged and labelled. However, when popcorn is mixed with sugar thereby changing its character to sugar confectionery (eg caramel popcorn), it would attract 18% GST.
The GST Council meeting was attended by Union Minister of State for Finance, Pankaj Chaudhary, along with Chief Ministers of Goa, Haryana, Jammu and Kashmir, Meghalaya, and Odisha, as well as Deputy Chief Ministers from Arunachal Pradesh, Bihar, Madhya Pradesh, Rajasthan, and Telangana. Senior officials from the Finance Ministry, including those from the Economic Affairs and Expenditure Departments, were also present.
(This story was taken from syndicated feed and was only edited for style by Gujarat Samachar Digital team)
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