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GST Council to correct the rates and remove various tax exemptions

While permitting states to issue an e-way bill for the intra-state movement of gold and precious stones, authorities said the GST Council authorised modifications to tax rates on specific items and services. Along with approving a GoM report on high-risk tax payers to avoid cheating, the Council, presided over by Finance Minister Nirmala Sitharaman and made up of state equivalents, also approved a number of compliance processes for GST-registered enterprises.

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KEY POINTS:

  • The important topics of extending compensation to states past June 2022 and imposing a 28% GST on casinos, online gaming, and horse racing will be discussed.
  • States headed by the opposition have pushed for either an extension of the GST compensation system or an increase in the states’ percentage of revenue from the present 50%.
  • In the meeting, the Council accepted the interim report on rate rationalisation, which included correcting the inverted duty structure and eliminating the tax exemption on some items in order to simplify the rate structure, from the group of state finance ministers led by Karnataka Chief Minister Basavaraj S Bommai.
  • The GoM has proposed replacing the GST exemption with a 13% tax and removing it from a variety of services, such as hotel lodging costing less than Rs 1,000 per day.
  • It also suggested imposing a 5% GST surcharge on room rent (excluding ICU) for hospitalised patients when those costs exceed Rs 5,000 per day.

Important Takeaways For All Competitive Exams:

  • Chief Minister of Karnataka: Basavaraj S Bommai
  • Finance Minister: Nirmala Sitharaman

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GST Council to correct the rates and remove various tax exemptions_60.1

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