Finance Minister Nirmala Sitharaman presided over the 53rd GST Council meeting on June 22, 2024, with significant decisions aimed at enhancing the GST framework. Attended by state finance ministers, the session brought forward crucial amendments, tax rate adjustments, and exemptions. Here are the major takeaways from the meeting:
Aadhaar-based biometric authentication will be rolled out across India to curb fraudulent input tax credit claims made through fake invoices. This initiative is part of the government’s efforts to enhance tax compliance and reduce fraud.
The Council announced a uniform GST rate of 12% for all milk cans, whether made of steel, iron, or aluminum. This measure aims to standardize the tax treatment of these essential items.
The central government reiterated its intent to bring petrol and diesel under the GST regime, pending consensus on the applicable tax rate among states. This move aims to establish uniform taxation for fuel across the country.
In a bid to make railway services more affordable, the Council granted a GST exemption on platform tickets, reducing the financial burden on passengers.
The GST rate on various types of carton boxes has been reduced from 18% to 12%. This change is expected to benefit manufacturers and consumers by lowering the cost of these essential packaging materials.
Hostel accommodation services outside educational institutions are now exempt from GST for up to ₹20,000 per person each month. This exemption is designed to make hostel accommodation more affordable for non-student residents.
Finance Minister Sitharaman emphasized the Union Government’s commitment to supporting states through timely tax devolution, Finance Commission grants, and GST compensation settlements. She highlighted the ‘Scheme for Special Assistance to States for Capital Investment’, noting that while most loans are unrestricted, a portion remains conditional on states implementing citizen-centric reforms and specific capital projects. Sitharaman encouraged states to leverage these loans by meeting the stipulated criteria.
To assist small taxpayers, the Council recommended extending the deadline for furnishing details and returns in the form GSTR 4 from April 30 to June 30, applicable for returns from the Financial Year 2024-25 onwards.
The GST Council has recommended waiving interest and penalties for demand notices issued under Section 73 of the GST Act, applicable to cases that do not involve fraud, suppression, or misstatements.
To reduce government litigation, the Council recommended setting monetary thresholds for filing appeals by the department in various courts: ₹20 lakh for the GST Appellate Tribunal, ₹1 crore for the High Court, and ₹2 crore for the Supreme Court.
These measures and changes introduced by the GST Council aim to simplify the tax system, reduce litigation, and enhance compliance while providing relief to taxpayers and making essential services more affordable.
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