Key Highlights of GST Council Meeting

Structure of the GST Council

The council is made up of:

• Union Finance Minister (Chairperson)
• Minister of State for Finance (Member)
• Finance/Tax Ministers from all States & Union Territories (Members)

Decisions are made through voting, where the Central Government holds 1/3rd of the votes and State Governments hold 2/3rd.

Key Functions and Recommendations

The GST Council periodically issues recommendations on:

1. GST Rate Revisions: Adjusting taxes on goods and services.
2. Exemptions: Identifying goods and services exempt from GST.
3. Compliance Simplifications: Making tax filing and documentation easier.
4. ITC Policies: Defining how businesses can claim Input Tax Credit.
5. Anti-Tax Evasion Measures: Using technology to track fraud.
6. Sector-Specific Policies: Addressing industry concerns and tax structures.

Notable Features of the GST Council

1. Federal Structure: Ensures equal participation of central and state governments.
2. Binding Decisions: All states must comply with Council decisions.
3. Dynamic Tax System: Regular updates keep GST policies relevant.
4. Tech-Enabled Compliance: GSTN portal, e-invoicing, and AI for fraud detection.
5. Dispute Resolution Mechanism: Streamlines the resolution of tax conflicts.

Latest GST Council Meetings (Updates, Dates, & Revised GST Rates)

55th GST Council Meeting: Latest Decisions

The 55th GST Council meeting introduced crucial policy decisions to streamline taxation and ensure fair business practices. Key decisions included:

1. Introduction of new GST return formats to simplify compliance for small businesses.
2. Adjustments in GST rates for luxury and essential goods to balance economic growth and affordability.
3. Strengthening of anti-evasion measures through AI-driven tax fraud detection tools.
4. Expansion of digital taxation provisions to bring digital economy transactions under GST purview.

54th GST Council Meeting: Major Takeaways

The 54th GST Council meeting aimed at improving tax policies and increasing revenue collection. The significant outcomes were:

1. Implementation of stricter e-invoicing regulations for businesses exceeding a specific turnover threshold.
2. Correction of the inverted duty structure affecting certain industries.
3. Introduction of a uniform tax rate for online gaming and casinos to improve compliance.
4. Establishment of a dispute resolution mechanism to address tax-related disputes efficiently.

53rd GST Council Meeting: Key Highlights

The 53rd GST Council meeting, chaired by the Union Finance Minister, focused on various tax rate changes, compliance measures, and reliefs for businesses. The key decisions included:

1. Reduction in GST rates on essential items to ease the burden on consumers.
2. Compliance simplifications to facilitate easier tax filing for MSMEs and small taxpayers.
3. Exemptions provided for specific sectors such as healthcare and education.
4. Clarifications on Input Tax Credit (ITC) rules to prevent fraudulent claims while benefiting genuine businesses.

GST Amendments Effective April 1, 2025

Several GST amendments recommended in previous Council meetings have come into effect as of April 1, 2025:​

1. Input Tax Credit (ITC) Distribution by Input Service Distributors (ISDs): Changes have been implemented to streamline the distribution of ITC by ISDs. 
2. Updates to GSTR-7 and GSTR-8: Modifications have been made to these returns to enhance compliance procedures.

Anticipated GST Relief on Insurance Premiums

The GST Council is considering reducing the GST rate on life and health insurance premiums from the current 18% to 5%. This proposal aims to make insurance more affordable and is expected to be finalized in the upcoming Council meeting, likely scheduled for late April or early May 2025. The Insurance Regulatory and Development Authority of India (IRDAI) has expressed support for this initiative. 

Highlights of the 52nd GST Council Meeting

The following are the highlights of the 52nd GST Council Meeting:

1. A GST Amnesty Scheme is going to extend appeal filing time till 31 January 2024 against the time period of three months under the law for all the orders passed till March 2023 12.5 percent pre-deposit of tax 2.5 percent is paid in cash.
2. CGST Section 159 is going to be amended. Automatic restoration of will be done of provisionally attached property after completion of one year.
3. It is also clarified that no GST will be charged on personal guarantee provided by directors to the bank against loans or credit limits sanctioned to the company.
4. The GST Council has delegated to states the authority to tax Extra Neutral Alcohol (ENA) used in alcoholic beverages for human consumption.
5. The taxable value of a corporate guarantee made between related people (a holding company and its subsidiary) is defined as 1% of the guaranteed amount offered or the real compensation.

Highlights of the 51st GST Council Meeting

Given below are the highlights of the 51st GST Council Meeting:

1. The valuation of the supply of online gaming as well as actionable claims in casinos is done on the basis of the amount deposited/ payable to/ paid with the supplier by the player and not on the overall value of a single bet placed. Thus, the amount entered into the games or bets out of winning of last games will be excluded from the value.
2. There will not be any sort of changes in the 28 percent GST charged on the face value, irrespective of whether it is a game of skill.
3. The Integrated Goods and Services Tax Act, 2017 (which includes Schedule III of CGST Act 2017) and the Central Goods and Services Act, 2017 will be in order to provide clarity on the tax charged on the supplies in casinos, horse racing, as well as online gaming.
4. The CGST Rules, 2017 are to be amended in order to include particular provisions for the valuation of online gaming supply as well as the supply of actionable clams in casinos.
5. The GST Council will gather again six months after implementation to examine the situation.

Conclusion

The GST Council plays a crucial role in shaping India's tax landscape. By ensuring uniform taxation, improving compliance, and refining tax policies, it supports economic stability. The latest meetings indicate a strong focus on digital tax transformation, ease of doing business, and revenue enhancement. Staying informed about GST updates is essential for businesses and taxpayers alike.