A closer look at key decisions:
What is getting cheaper?
– Fortified Rice Canals (FRK): GST on Fortified Rice Kernels (FRK) has been reduced to 5% when supplied through Public Distribution System (PDS) to benefit the weaker sections of the society.
– Gene therapy: Gene therapy is fully exempted from GST. This makes the latest medical treatments more affordable.
– Preparation of food for free distribution: The GST rate will now be reduced to 5% for food distributed under government schemes for economically weaker sections.
– Long Range Surface to Air Missile (LRSAM) Assembly: Exemption from Integrated Goods and Services Tax (IGST) on systems, subsystems and tools used for LRSAM manufacturing supporting the defense sector.
– Inspection equipment for the IAEA: IGST exemption on import of equipment and samples usable for International Atomic Energy Agency (IAEA) inspection, supporting international compliance efforts.
– Black pepper and raisins (direct sales): Direct sales by agriculturists are clarified as liable for GST, offering relief to agricultural producers.
Is it getting more expensive?
– Old and used vehicles (including EVs): GST on all old and used vehicles has been increased from 12% to 18%, except for certain petrol and diesel variants.
– Ready-to-Eat Popcorn: Pre-packaged and labeled snacks will now attract 12% GST.
- Caramelized Popcorn will attract 18% GST.
- Popcorn mixed with salt and spices, classified as salty, will continue to attract 5% GST if not pre-packaged and labelled.
– Autoclaved Aerated Concrete (ACC) Blocks: If the blocks have more than 50% fly ash content, 12% GST will be applicable.
– Sponsorship Services by Corporates: Now under the forward charge mechanism, potentially increasing costs for corporate sponsors.
– Penalty appeals only: Only penalty appeals under the Appellate Authority require a higher advance deposit.
Other key changes
– Vouchers: No GST will be applicable on voucher transactions, as they are not considered to be supply of goods or services.
– Penal charges: Penalties collected by banks and NBFCs for non-compliance with loan conditions will no longer attract GST.
– Definition update for prepackaged and labeled goods: The Council has recommended revising the definition to include all retail items pre-packaged (up to 25 kg or 25 litres) as per the Legal Metrology Act. These goods should carry mandatory declarations under the Act and its rules.