New Delhi, September 17:
The 45th goods and services tax (GST) Council meeting will be held today, chaired by Finance Minister Nirmala Sitharaman in Lucknow, which is likely to discuss bringing petrol and diesel under the ambit of indirect tax and also decide on GST rate reduction on COVID-19 essential medicines. This is the first on-ground GST Council meeting to be conducted in almost 20 months, as the last such meeting was held in 2019, before COVID-related restrictions were enforced in the country.
45th GST Council Meeting 2021: Here’s what’s on GST Council Meeting’s Agenda for today:
1. Inclusion of petrol, diesel under the ambit of GST:
The GST Council today is likely to discuss the idea of bringing petrol and diesel within the ambit of the GST. On June 21, the Kerala High Court issued a directive on the writ petition filed by the Kerala Pradesh Gandhi Darshanavedhi that petrol and diesel should be included in GST, as fuel prices touched record-highs this year. The Kerala High Court’s directive stated that the inclusion of petrol, diesel under GST should be examined by the GST Council.
The GST Council is likely to discuss levying GST on petroleum crude, high speed diesel, motor spirit (petrol), natural gas and aviation turbine fuel (ATF), according to sources.
However, Kerala Finance Minister K N Balagopal and Maharashtra Deputy CM Ajit Pawar have said that they are completely against any idea to include petrol, diesel under GST.
2. Extension of GST Rate Reduction on COVID-19 essential medicines
The 45th GST Council is likely to discuss extending the GST rate reduction from 12 per cent to five per cent on four important medicines required for the treatment of COVID-19 – Tocilizumab, Amphotericin B, Remdesivir and anti-coagulants such as Heparin – till December 31, 2021. The rate reduction on these medicines are currently valid till September 30, 2021. (Also Read: GST Council Cuts Rates On COVID Supplies, No Tax On Black Fungus Medicine )
Earlier in the year, the GST Council reduced tax rates on medical grade oxygen, oxygen concentrator/generator, ventilators, ventilator masks /canula /helmet, among other related medical devices from 12 per cent to five per cent – based upon the recommendations of group of ministers – constituted at the 44th GST Council meeting to deliberate on the tax rates of COVID-related essential items.
3. GST compensation shortfall to states after June 2022 period
The GST compensation of ₹ 1,13,000 crore have been released to states since April 2020. However, the amount in the GST compensation fund is not adequate to meet the full compensation requirement because of COVID impact on GST and GST Cess collection, according to sources. The GST Council today may consider options that exist to make up for the GST compensation shortfall.
4. Inclusion of food serving delivery services under GST
The GST Council is likely to discuss a proposal to treat food serving, preparation and food delivery services (including takeaway, door delivery services) as “restaurant service”. These services may attract a five per cent GST, according to sources.
Also. if the GST Council approves the proposal, major food delivery apps such as Zomato, Swiggy, among others, will be covered under the five per cent GST slab.