GST Council Meeting Updates: Finance Minister Says Compensation Cess To Continue Till March 2026
GST Council Decides On Compensation Cess, Rate Changes
The Goods and Services Tax Council on Friday took decisions around compensation cess and GST rates of certain items and services in its first in-person meeting since March 2020.
Here are the key decisions taken at the meeting:
GST compensation cess to continue till at least March 2026.
Concessional rates on Covid-19 related drugs to continue till Dec. 31, 2021.
Exemption on GST for goods transported via air and sea extended.
Majority of the states not in favour of bringing petroleum under GST.
GST rate on biodiesel reduced.
Council agreed on changes in rates to correct inverted duty structure for footwear and textiles.
Watch the full press conference by Finance Minister Nirmala Sitharaman here...
Other Changes To Streamline Compliance
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.
Groups of Ministers To Evaluate Certain Changes
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.
GST Compensation Cess To Continue Till March 2026
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.
Change In Rates To Correct Inverted Duty In Footwear And Textiles
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.
GST Relief For Export Goods Extended For A Year
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.