Jaisalmer (Rajasthan), December 21 (IANS). Union Finance Minister Nirmala Sitharaman on Saturday announced that the Goods and Services Tax (GST) Council has decided to reduce the tax rate on rice to 5 per cent, make life-saving gene therapy tax-free and eliminate surface-to-air missiles (SAMs). It has been approved to extend the period of GST exemption for parts used in the manufacture of ).
Addressing the press conference after the 55th meeting of the GST Council, the Finance Minister said that it has been decided to reduce GST on rice from 18 percent to 5 percent.
He said, “Similarly, 5 per cent GST exemption on preparation of food items is applicable on ingredients which are distributed free to economically weaker sections under government programmes, subject to existing conditions; hence also It is just an extension of the existing 5 percent rate.”
Explaining the rationale for increasing the tax on caramelized popcorn to 18 per cent, the Finance Minister said it also includes added sugar, which is a separate category like carbonated drinks, which is harmful to health and hence it should be brought under the higher tax slab. Is placed.
He said that salty and plain popcorn are also being sold in the market and GST has not been increased on them.
The Finance Minister said that black pepper (be it fresh green or dry black pepper) and raisins, when supplied by the farmer, do not attract GST. However, if these items are sold by traders, they will have to pay tax.
He also said that all parts involved in the manufacturing of SAM missiles, including software, will be exempted from GST. The Finance Minister also said that payment aggregators doing transactions of less than Rs 2,000 are eligible for the exemption, but this does not apply to payment gateways and fintech services.
He said that no GST is payable on the penal charges or levies collected by banks and NBFCs for non-compliance of loan terms by borrowers. This step will prove to be very helpful in helping small businesses.
The Finance Minister further said that the issue was discussed in the meeting whether separate GST should be imposed on the charges for delivery of food items provided by quick commerce companies and e-commerce apps, but no decision was taken in this matter. Has been taken. He said the council felt the issue needed a more detailed discussion.
The Finance Minister also said that ACC blocks containing more than 50 percent fly ash will attract 12 percent GST. No decision has been taken yet on bringing Aviation Turbine Fuel (ATF) under the ambit of GST, as many states are opposing the move. This issue is expected to be discussed further in future meetings.
He said the Group of Ministers constituted on health insurance has not yet received inputs from insurance regulator IRDAI, so more time is needed to take a decision on the issue.
He said the Group of Ministers formed on rate rationalization also needs additional time as the report is yet to be finalised.
The Finance Minister further said that the Council discussed whether GST on Floor Space Index (FSI) for construction should be reverse charged or forward charged. No decision was taken on this issue, as it has an impact on the revenue of municipalities and besides, land is a state subject.
He also informed that a concept note has been given in-principle approval by the GST Council to bring amendments in GST to make registration easier for small companies availing lower input tax credit. These companies are facing problems in registration and it has been decided to simplify the system to make the process easier for them.
The Council has approved amendments in the definition of pre-packed and labeled goods for retail sale. Nirmala Sitharaman said the move is aimed at clarifying the definitions for all items, as there is a lot of confusion on the issue at present.
–IANS
FZ/CBT
