FM Nirmala Sitharaman Announces Key GST Changes After Council Meeting | ET Now | Latest News

Summary

The GST Council has announced key decisions, including forming a committee to resolve the negative balance on IGST, involving both State and Central government officials. Universities and research institutions, including those with income tax exemptions, will be exempt from paying GST on research funds. Additionally, the GST rate on cancer drugs has been reduced from 12% to 5%, aiming to make treatment more affordable. A request for further clarity on IGST operations has led to informal video sessions with the Revenue Secretary. These measures highlight efforts to streamline tax processes and reduce costs in healthcare and research sectors.

Takeaways

• 😀 The GST Council is addressing the negative balance in IGST, and a committee will be formed to resolve this issue.
• 😀 A committee under the chairmanship of the Additional Secretary of the Revenue Department will include officers from both state and central governments.
• 😀 The committee's primary task is to resolve the excess IGST allocations made to states and finalize a way forward.
• 😀 There is a focus on improving understanding of how IGST works, with informal sessions planned for state finance ministers.
• 😀 Universities and research centers established by both central and state laws, as well as institutions with income tax exemptions, are exempt from paying GST on research funds.
• 😀 Institutions that receive research funding from both public and private sources will not be required to pay GST.
• 😀 The GST rate on cancer drugs will be reduced from 12% to 5% to reduce the cost of cancer treatment.
• 😀 This reduction in GST rates for cancer drugs follows a previous decision to cut customs duties on cancer-related products in the budget.
• 😀 The committee of secretaries will hold discussions on how to address the IGST balance, especially in relation to states with excess IGST allocations.
• 😀 The Karnataka Finance Minister has requested more clarity on the IGST system, prompting the Revenue Secretary to offer informal video meetings for better understanding.

Q & A

What is the current issue with IGST mentioned in the script?

The script highlights a negative balance in IGST (Integrated Goods and Services Tax), and the need for a committee to resolve the issue of excess payments made to certain states.

What is the role of the committee under the chairmanship of the Additional Secretary, Revenue?

The committee, consisting of officers from both state and central governments, has been set up to discuss and finalize the way forward regarding the negative balance on IGST.

Why is there a negative balance on IGST?

The negative balance arises from excess IGST payments made to certain states over a period, which need to be retrieved.

What steps are being taken to explain how IGST works?

A committee of secretaries has been formed to explain the workings of IGST. Additionally, the Revenue Secretary will hold informal meetings with interested ministers to clarify the formulation and calculation of IGST.

What is the government's decision regarding GST exemptions for certain institutions?

Universities and research centers established by central or state laws, and institutions with income tax exemptions, will be exempt from paying GST on research funds received from both public and private sources.

What reduction in GST rates was announced for cancer drugs?

The GST rate on specified cancer drugs has been reduced from 12% to 5% to make cancer treatment more affordable.

Why was the GST rate on cancer drugs reduced?

The reduction in GST rates aims to lower the cost of cancer treatment, making it more accessible to patients.

Which institutions are eligible for GST exemptions on research funds?

The institutions eligible for GST exemptions on research funds include universities and research centers established by central or state laws and those institutions that have obtained income tax exemption.

What is the role of the Committee of Secretaries in resolving the IGST issue?

The Committee of Secretaries will determine how to handle the negative IGST balance and work on a solution to retrieve the excess payments made to certain states.

What additional measures are being taken to educate officials about IGST?

The Revenue Secretary is offering informal video meetings to explain IGST's formulation and operation to interested officials who wish to better understand how IGST works.