NEW DELHI: Following opposition from Punjab and Tamil Nadu, the 50th meeting of the GST Council held on Tuesday decided to exclude sedans from the highest tax bracket of 28 per cent GST and 22 per cent cess.
As against four conditions for imposing the 22 per cent cess, the GST Council deleted the condition that they should be “popularly known as SUVs”. This, the government reasoned, would exclude sedans from the highest tax bracket. The earlier three conditions will remain – length should not be more than 4000 mm, engine capacity of over 1500 cc and ground clearance of over 170 mm.
The council also said supply of food and beverages in cinema halls was taxable as restaurant service in some cases. It would generally be 5 per cent and not 18%, it clarified. It also extended exemptions to cancer-related drugs, medicines for rare diseases and food for special medical purposes that are imported by centres of excellence or an individual for personal use.
Giving a summary of the decisions taken, Union Finance Minister Nirmala Sitharaman told the media that the council also considered the issue of states giving certified accounts to receive compensation dues.
The rates of four items have been reduced, mainly from 18 to 5%, she said. These include uncooked, unfried snack pellets, fish soluble paste, imitation zari threads and LD slag.
The council also recommended the rules for Goods and Services Tax Appellate Tribunal (Appointment and Conditions of Service of President and Members) Rules, 2023, to pave the way for setting up of the GST Appellate Tribunal by August 1. Regarding the number of state Benches, it was decided to start them in a phased manner.
Meanwhile, Revenue Secretary Sanjay Malhotra on Tuesday allayed concerns of several Opposition-ruled states on the changes made in the money laundering law stating that the amendments were required to meet the obligations of the FATF.
Several states had expressed concern over the Centre’s decision to allow the ED to share information with GST Network, with Finance Minister of Punjab Harpal Singh Cheema saying it amounted to “tax terrorism” and scaring small businesses.