New Delhi, September 9 (IANS). The GST Council, chaired by Finance Minister Nirmala Sitharaman, could not decide on a reduction in tax rates on life and health insurance in its meeting held on Monday. A group of ministers will be formed to consider this. At the same time, taxes have been reduced on cancer medicines and namkeen.
The ministerial group on life and health insurance will be headed by Bihar deputy chief minister Samrat Choudhary, who is currently heading the panel on GST rate rationalisation.
The 54th meeting of the GST Council reached a “broad consensus” to provide relief to individuals and senior citizens with the decision on the GST applicable on health insurance premium. The current GST rate on health and life insurance is 18 per cent.
Meanwhile, the GST Council announced reduction in GST rate on cancer drugs from 12 per cent to 5 per cent and on salty snacks from 18 per cent to 12 per cent.
The members also agreed to set up a ministerial group on compensation cess.
Finance Minister Nirmala Sitharaman said, “The GST Council has agreed to form a Group of Ministers which will now study and decide on how to proceed on the compensation of cess that expires after March 2026.”
The total cess collection is estimated to be Rs 8.66 lakh crore by March 2026. After settling the loan payments, an estimated surplus of about Rs 40 thousand crore is expected.
Revenue Secretary Sanjay Malhotra said the GST compensation cess may be discontinued after loan repayment.
Speaking at a press conference after the meeting, Malhotra said import of services by foreign airlines will be exempted from GST.
Finance Minister Sitharaman said universities and research centres established by laws of the central or state government, or that are exempted from income tax, will now be exempted from paying GST on research funds.
The GST panel also decided to introduce business-to-customer (B2C) GST invoices. This new system for GST invoice management will be effective from October 1.
It was also announced that the GST on car seats would be increased from 18 per cent to 28 per cent.
–IANS
AKJ/