Mon Sep 09 15:56:38 UTC 2024: ## GST Council Makes Key Changes: R&D Grants Exempted, Cancer Drugs Tax Cut

**New Delhi:** In a significant move, the GST Council has recommended exempting research and development (R&D) grants given to recognized educational institutions from GST. The decision comes after several universities received show-cause notices for unpaid taxes amounting to ₹220 crore.

The exemption will apply to both government and private institutions, with no threshold limit. This decision is expected to boost research activities in India and bring its tax regulations in line with global practices.

The Council also announced a reduction in GST rates for cancer drugs, bringing them down to 5% from 12%. This aligns with the budget announcement of lower customs duty on these medications.

Further, the GST rate on extruded or expanded savory food products, including namkeens and bhujia, will be reduced to 12% from 18%, bringing them on par with similar pre-packaged snacks.

In another major change, the Council recommended introducing a Reverse Charge Mechanism (RCM) for metal scrap transactions. Under this system, the registered recipient will be responsible for paying the GST even if the supplier is below the threshold limit. A TDS of 2% will also be levied on metal scrap supplied by registered businesses.

Other notable recommendations include a 5% GST on passenger transport by helicopters, exemption of GST on approved flying training courses, and the inclusion of location charges in composite construction services. A pilot program for voluntary B2C e-invoicing was also announced.

These changes aim to simplify tax regulations, reduce the burden on taxpayers, and promote growth in key sectors like healthcare, education, and manufacturing.

Read More