What’s Getting Cheaper and Costlier After the Latest GST Council Meeting?
Last Updated: December 22, 2024, 14:12 IST
The GST Council, chaired by Union Minister for Finance & Corporate Affairs Nirmala Sitharaman, recently concluded its 55th meeting in Jaisalmer, Rajasthan.
FM Nirmala Sitharaman addresses media after the GST Council meeting on December 21, 2024
This meeting resulted in significant recommendations aimed at simplifying the Goods and Services Tax (GST) system, reducing the tax burden in specific sectors, and providing relief to individuals.
### Key Changes in GST Rates: What’s Cheaper and Costlier
The GST Council made several adjustments to the tax rates on various goods and services. Here’s a breakdown of the major changes:
* **Cheaper:**
* **Fortified Rice Kernel (FRK):** The GST rate on FRK (HS Code 1904) has been reduced to 5%, making it more affordable and accessible.
* **Gene Therapy:** GST will no longer be levied on gene therapy, making this crucial medical treatment more readily available.
* **Pepper and Raisins from Agriculturists:** Pepper (fresh green or dried) and raisins supplied directly by agriculturists will now be exempt from GST.
* **Costlier:**
* **Old and Used Vehicles (including EVs):** The GST rate on the sale of old and used vehicles will increase from 12% to 18%, impacting motor vehicle transactions.
### Other Important Changes
Apart from the direct impact on prices, the GST Council also made several other noteworthy changes:
* **Contributions to Motor Vehicle Accident Fund:**
GST will be exempt on contributions made by general insurance companies to the Motor Vehicle Accident Fund. This will streamline the collection and use of these contributions.
* **Clarifications on GST for Autoclaved Aerated Concrete (ACC) Blocks:**
ACC blocks containing over 50% fly ash content will be classified under HS 6815 and attract a 12% GST rate.
* **Penal Charges by Banks and NBFCs:** The Council clarified that GST is not applicable to penal charges levied by banks and Non-Banking Financial Companies (NBFCs) on borrowers for non-compliance with loan terms.
* **Regularisation of Past Issues:** The Council decided to regularize past GST-related issues on an “as is where is” basis.
This latest round of GST Council recommendations aims to simplify the tax system, provide relief to individuals and businesses, and further stimulate economic growth.
**Stay updated on the latest GST news and announcements. **