The Goods and Services Tax (GST) Council rate panel will clarify several tax related issues in its meeting scheduled this week. The 48th GST Council, chaired by Union Finance Minister Nirmala Sitharaman, will be held on December 17, 2022, via video conferencing after a gap of nearly six months. Sources told CNBC -TV18 that in the meeting, the panel may clarify tax related issues. SUVs with an engine capacity of 1,500 cc and length exceeding 4,000 mm with a ground clearance of 170 mm could be levied a 22 percent compensation cess.
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All fruit pulp or fruit juice-based drinks with carbon-dioxide added as a ‘preservative/additive’ will could be levied a GST of 18 percent. Private refiners will also be allowed a concessional 5 percent GST rate similar to oil marketing companies (OMCs) for blending ethanol with petrol to provide a level playing field.
Last month, the Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi, approved a hike in the cost of ethanol procured by the public sector OMCs from distilleries. “The Cabinet Committee on Economic Affairs chaired by Prime Minister Narendra Modi has approved higher ethanol price derived from different sugarcane based raw materials under the EBP (ethanol blended petrol) programme for the forthcoming sugar season 2022-23 during ESY 2022-23 from 1 December 2022 to 31 October, 2023," said an official press release.
Besides, the panel will also clarify that subsidy in the form of viability gap funding (VGF) paid by government to airlines for operating regional connectivity scheme (RCS) flights is not taxable. As per the sources, the GST Fitment Committee has refused the industry demand to reduce GST rate on gold, diamonds, silver, components of battery energy storage system including li-ion batteries, while exemption will be granted to incentives paid by government to banks under the scheme for promotion of RuPay Debit Cards and low value BHIM-UPI transactions.
As per the Ministry of Electronics and Information Technology (MeitY), the Centre on December 21, decided to incentivise the acquiring banks by paying a percentage of the value of RuPay debit cards transactions and low-value BHIM-UPI transaction (up to Rs 2,000) with effect from April 1, 2021, for a period of one year.
The 48th GST Council meeting holds significance as it is the last before the Union Budget which will be tabled in Parliament on February 1, 2023. It is expected that the panel may also discuss two reports regarding GST levy on casinos, online gaming and horse racing, and the other on the setting up of an appellate tribunal, apart from tax rate changes on various items.
In the previous 47th GST Council meeting, conducted on June 28 and 29 in Chandigarh, the GST Council had decided to accept the group of ministers’ interim reports on the correction of duty inversion and exemption. Pre-packaged and pre-labelled retail packs, including curd, lassi and butter milk, were also brought under GST. The Goods and Services Tax (GST) Council is headed by the Union finance minister and comprises representatives of all states and Union Territories (UTs).