GST Council Meet: Here's What Gets Cheaper!

The Council Meet which had all the eyes of economic experts and entrepreneurs recently was chaired by Finance Minister Nirmala Sitharaman followed by her pre-budget consultations with finance ministers of states and Union Territories. The meeting which concluded on June 22, is being seen as a series of positive proposals that are aimed at simplifying tax compliance and reducing litigation

The 53rd GST Council Meeting, hence, suggests major recommendations over a few items and services that one must know.

What got Cheaper?

Services related to hostel accommodation

The GST council has exempted services related to hostel accommodation outside educational institutions making it ₹20,000 per person per month with an exemption for up to 90 days. This benefit can only be availed if the stay is up to 90 days. Moreover, this condition also ensures that hotels do not misuse the exemption.

Railway services

The services offered by the Indian Railways like the platform ticket sale, retiring room facility, waiting rooms, cloakroom facilities, and battery-operated car services, along with intra-railway services will also be GST-free.

Carton Boxes

The next in line are all kinds of carton boxes. The Council has recommended the reduction of GST from 18 percent to 12 percent on all kinds of carton boxes. 

Interest on Penalties on Tax Notice 

A waiver of interest has been announced by the GST Council on tax demand notice that is issued under Section 73 of the GST Act for fiscal years 2017-18, 2018-19, and 2019-20. Those taxpayers who pay the full tax amount that is demanded in the notice by March 31, 2025, will be benefitted from this waiver.

Milk Cans 

A uniform GST rate of 12 percent from 18% on all milk cans, irrespective of their material (steel, iron, aluminum) has been announced.  

Solar Cookers

For both single or dual-energy source solar cookers, a uniform GST rate of 12 percent has been announced from 18% which was the earlier rate.

Grocery and household items

• Flour or atta, taxed at 3.5% in the pre-GST regime has attracted no tax in this regime.
• Sanitary napkins were earlier taxed at 12% earlier and that has stayed the same in this GST regime. 
• Unbranded ayurvedic medicines, which were earlier taxed at 12% have now been taxed at 5%.
• Items like detergents, televisions, and cosmetics have also got the tax rate down to 18% from 28%.
• Products like mobile phones, electric appliances, washing machines, and refrigerators, which were taxed at more than 31% in the pre-GST regime, will now come down to 18%. 

Other Recommendations

There are certain recommendations proposed that will come into force in the next union budget presented by the Modi government in the parliament. These include:

• All types of sprinklers that includes fire and water sprinklers, will attract a uniform GST rate of 12 percent.
• Fertilizers are charged a 5% GST rate.
• Raw materials like sulfuric acid and ammonia face an 18% GST rate.
• The GST Council also gave its nod for extending the time for availing input tax credit (ITC) on any invoice or debit note.