Business EconomyPosted at: Dec 21 2024 7:48PM


GST Council defers decision on exempting insurance premium; rationalized on other items

New Delhi, Dec 21 (UNI) The much anticipated exemption of tax on health and other life insurance premiums has been deferred while lowering the GST on several items including fortified rice kernels to 5 per cent from 18 per cent, reduction in rate of compensation cess to 0.1 per cent on supplies to merchant exporters and extension of exemption of missile parts are some of the key highlights of the 55th meeting of GST Council.
The issue of rationalization of tax on health and life insurance premium came up for discussion but the GoM under Bihar Deputy Chief Minister Samrat Chaudhary felt that more time is required to do some more work on the subject and also views from the insurance regulator are awaited.
In view of this no decision has been taken on this, Finance Minister Ms. Nirmala Sitharaman said after the meeting of the GST Council.
Sitharaman announced exemption for payment aggregators “alone” who do less than Rs 2000 payment stressing this is applicable only for aggregators and not applicable for payment gateways.
The council decided to reduce the tax rate on fortified rice kernels to 5% from 18%.
On the issue of bringing ATF under the GST ambit, the Minister said the matter come up for discussion but the states are very categorical that like petrol and diesel are under the states government, ATF should also be treated same way so “no decision has been taken on this also”.
Additionally, the panel headed by the Finance Minister also decided to exempt gene therapy from being taxed.
"There is a reduction in the rate of compensation cess to 0.1 per cent on supplies to merchant exporters at par with the GST rate on such supplies. So, this was particularly important request which had come from traders and exporters," Ms Sitharaman told media.
The Finance Minister also announced that despite discussions, decision on GST rate for food delivery platforms was deferred.
In another major decision, the GST Council decided that no GST would be payable on penal charges levied on borrowers by banks or NBFC in case of non-compliance of terms.
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