Sat Dec 21 17:42:22 UTC 2024: **GST Council Postpones Key Decisions, Approves 5% GST on New EVs**

NEW DELHI – The 55th Goods and Services Tax (GST) Council meeting concluded Saturday with several key decisions postponed, including a reduction in GST on insurance premiums. While the issue was debated, disagreements among member states necessitated further deliberation, according to Bihar Deputy Chief Minister Samrat Choudhary. The Council did, however, approve a 5% GST rate on new electric vehicles (EVs) to promote their adoption, while used EVs sold between individuals will remain GST-free. However, used EVs purchased and resold by companies will be taxed at 18%.

Other notable outcomes from the meeting include:

* **Calamity Cess:** A Group of Ministers (GoM) will be formed to determine the implementation of a 1% calamity cess on specific goods and services to aid states in disaster recovery. Disagreements among states regarding the scope of the cess led to the GoM’s formation.

* **Food Delivery GST:** A decision on the GST rate for food delivery services provided by e-commerce operators has been deferred to a fitment committee. The current ambiguity impacts notices sent to food delivery apps.

* **Other Decisions:** The Council exempted gene therapy from GST, extended the IGST exemption on surface-to-air missiles, and clarified that no GST is payable on bank penalty charges. Further, GST rates were reduced for fortified rice kernels and supplies for merchant exporters. A 12% GST rate was set for ACC blocks with 50% fly ash. The Council also addressed taxation of caramelized popcorn and clarified GST liability for black pepper and raisins supplied by agriculturists.

Several key matters remain unresolved, including the GST on quick commerce and the taxation of Floor Space Index (FSI). The Council also decided against including aviation turbine fuel (ATF) in the GST. Concerns regarding the impact of these unresolved issues on various sectors have been raised by industry experts. Further updates are expected from CNBCTV18.com.

Read More