GST Council Meeting Updates: Finance Minister Says Compensation Cess To Continue Till March 2026

The Council also agreed on several measures to streamline compliances in GST.

• Aadhar authentication to be manddatory for being eleigible to file refund claim.

• Late fee for delayed filing of GSTR-1 form to be auto-populated and collected in next open return in GSTR 3B.

• Refunds to be dibursed in bank accounts that are linked with PAN on which GST registration has been obtained.

Finance Minister said that two groups of ministers will be constituted to look into certain changes in the GST regime.

• One group will be looking at rate rationalisation issues and submit a report in 2 months.

• The second group will look into related issues of e-way bills, fastags, technology, compliance, composition schemes. They, too, will submit a report in 2 months.

Finance Minister Niramala Sitharaman has said that GST compensation cess will need to be extended till March 2026.

This is being done to recoup the revenue to repay loans that are taken to cover the cess shortfall by states in FY21 and FY22, Sitharaman said.

The GST Council has agreed to changes in rates to correct inverted duty structure anomalies in footwear and textile sectors. This will be implemented from Jan. 1 2022.

Goods that are transported by air and sea will continue to be exempt from GST for one more year. This is due to difficulties being faced by exporters for getting input tax credit refund, Sitharaman said.

The national permit fee charged by states for goods vehicles operating throughout India is being exempted from GST.

Finance Minister Nirmala Sitharaman said that the GST Council discussed bringing petroleum under GST—as directed by the Kerala High Court—but decided that the time was not right to implement it.

The GST rate on biodiesel that is supplied to oil marketing companies for blending with diesel has been reduced to 5% from 12% earlier.

Life-saving drugs Zolgngelsma and Viltepso will be exempted from GST, Finance Minister Nirmala Sitharaman said after 45th GST Council Meeting.

• Drugs suggested by the Health Ministry for treating muscular atrophy will also be exempted from IGST on import for personal use.

• Concessional GST rates on drugs related to Covid0-19 has also been extended till Dec. 31, 2021 from Sept. 30 earlier.

A number of key items are expected on the agenda on Friday.

The Council may take a call on the tenure of the National Anti-Profiteering Autority whose four-year-term ends on Nov. 30. There are currently 39 cases that are pending disposal with the NAA, while 427 cases are either under investigation by the Directorate General of Anti-Profiteering or under scrutiny of various committees.

Besides that, the Council may deliberate further on the scenario for GST compensation for states after June 2022. The federal government is expected to lay out the options that can be considered to make up for the shortfall in tax collections for states.

Another decision on the anvil is about whether e-commerce operators like Swiggy and Zomato are liable to pay GST on the restaurant services that are supplied through them.

The GST Council will is also expected to provide some rate relief for Covid-19 essentials and medicines. Media reports have also suggested that the Council could review the rate of 50 other items.

Follow all updates from the 45th meeting of the GST Council here...