GST Council meeting held.
The GST Council, chaired by Finance Minister Nirmala Sitharaman, took important decisions in its 55th meeting, which aims to streamline the taxation system and curb tax evasion. However, the council deferred a decision on reducing the tax rates for insurance premiums, citing pending inputs including recommendations from the Insurance Regulatory and Development Authority of India (IRDAI).
Track and trace system approved
Taking a historic decision, the Council approved the implementation of track and trace mechanism for theft-prone items. The system will place a Unique Identification Mark (UIM) on specified items or their packages, helping authorities trace them in the supply chain. It aims to include a provision through Section 148A in the CGST Act, 2017, to empower the Government to put in place a mechanism to track and trace products prone to tax evasion.
No decision regarding GST on insurance premium
Finance Minister Nirmala Sitharaman said no decision was taken regarding reduction in GST on insurance premiums as the Group of Ministers (GO) needed more time to study the issue. He said that suggestions are awaited from many parties including insurance regulator IRDAI. He further said that the GST Council has also postponed the decision regarding rate rationalization, as the GoM needs more time for a comprehensive study.
18 percent GST on old car
At the same time, the GST Council decided to impose 18 percent GST on the margin value of old electric vehicles purchased for business use. Nirmala Sitharaman said the GST Council has also postponed the decision regarding rate rationalization as the GoM needs more time for a comprehensive study.
Explanation about popcorn tax
The GST Council on Saturday agreed to issue clarification regarding tax on popcorn. The council said pre-packaged and labeled ready-to-eat snacks will be taxed at 12 per cent. The GST Council said that if the snacks are caramelised, then 18 per cent GST will be applicable on them. Ready-to-eat popcorn with added salt and spices, if pre-packed and unlabelled, currently attracts five per cent GST. If it is packaged and prepared with labels, 12 percent GST is levied. However, when popcorn is mixed with sugar (caramel popcorn), its basic properties become similar to sugar confectionery, and as per the clarification, it will attract 18 per cent GST.
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