53rd GST Council: No tax on platform tickets, adjusted rates, 10 key announcements

In the 53rd GST Council meeting held on Saturday, June 22, 2024, Finance Minister Nirmala Sitharaman presented several significant initiatives. The conference, presided over by Sitharaman and attended by state finance ministers, covered topics such as tax modifications, incorporation of Aadhaar biometrics, and exceptions in railway services. Here are the 10 key announcements:

1. Petrol and diesel under GST

The central government has once again stated its desire to include petrol and diesel in the GST system, only when all states agree on the tax rate. This action is viewed as a move towards consistent fuel taxation nationwide.

2. GST rate on milk cans

A standard GST rate of 12% was introduced for every milk can, regardless of its material being steel, iron, or aluminum. This action is anticipated to bring uniformity to the tax treatment of these items.

3. Aadhaar-based biometric authentication

Nationwide implementation of Aadhaar authentication based on biometrics will be carried out in India. Finance Minister Nirmala Sitharaman stated that it will help combat fraudulent input tax credit claims using fake invoices. This program aims to enhance adherence to tax regulations by preventing fraudulent behaviors such as falsifying invoices.

4. Exemption for hostel accommodation

Services related to hostel accommodation outside educational institutions are exempt from GST up to Rs 20,000 per person per month. This exception is designed to decrease the price of hostel accommodation for non-student residents.

5. Indian Railways services

The council agreed to exempt GST on platform tickets to ease the financial burden on passengers. This decision is part of broader efforts to make train services more affordable.

6. Central support and conditional loans to states

During her speech, Finance Minister Sitharaman emphasized the Union Government's commitment to aiding states through quick tax sharing, grants from the Finance Commission, and settling GST compensations. She highlighted the significance of the 'Scheme for Special Assistance to States for Capital Investment', pointing out that while most loans come without conditions, some are linked to states implementing citizen-focused reforms and specific capital projects in different sectors. Sitharaman encouraged states to utilize these loans by fulfilling the specified criteria.

7. Reduction in GST for carton boxes

The GST rate on different types of carton boxes has been lowered from 18% to 12%. This adjustment aims to reduce costs for both manufacturers and consumers, making essential packaging materials more affordable.

8. New monetary limits for filing appeals

Finance Minister Nirmala Sitharaman also noted that the GST Council has suggested establishing financial limits for departments to appeal in different courts. She mentioned that the council proposed limits of Rs 20 lakh for the GST Appellate Tribunal, Rs 1 crore for the High Court, and Rs 2 crore for the Supreme Court to streamline government legal disputes.

9. Waiver of interest and penalties in non-fraudulent cases

Nirmala Sitharaman, the Finance Minister, announced that the GST Council recommended eliminating interest and penalties for demand notices issued under Section 73 of the GST Act. This waiver is applicable for scenarios excluding fraud, suppression, or misstatements.

10. Deadline for filing GSTR 4 extended for small taxpayers

In order to help small taxpayers, the Council recommended moving the deadline for submitting information and returns on form GSTR 4 from April 30th to June 30th. The minister also mentioned that this will apply to returns beginning in the Financial Year 2024-25.