The 55th meeting of GST Council was held on 21st December 2024 at Jaisalmer (Rajasthan) in which various recommendations have been made which inter alia, include changes proposed in CGST / IGST law, rules, clarifications and few rate reductions / rates increase, exemptions, compensation cess, ITC / ISD related amendments and so on. While the Council approved the recommendation in relation to IGST settlement, it noted the procedural rules for internal functioning of GST Appellate Tribunal (GSTAT) to be notified after examination by law panel. Also, it extended the time frame for Group of Ministers on the restructuring of GST compensation upto 30th June, 2025. A new Group of Ministers shall be formed to recommend a uniform policy on imposition of levy in case of natural disaster / calamity in the state, as requested by AP State.
Major takeaways from 55th GST Council meeting
GST Council had its 55th meeting at Jaisalmer on 21 December 2024, wherein, inter alia, following major decisions were taken:
- No GST shall be payable on:
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- transaction of vouchers
- gene therapy
- penal charges levied or collected by banks and NBFCs
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- Sponsorship services provided by body corporates under forward charge mechanism, presently under reverse charge.
- Taxpayers registered under composition scheme not to be covered under reverse charge mechanism for renting of any commercial / immovable property (other than residential dwelling) by unregistered person to registered persons w.e.f. 10.10.2024 on ‘as is where is’ basis.
- In case of hotels, definition of declared tariff omitted and specified premises amended; restaurant services in hotels to attract GST @ 18% with ITC and @ 5% without ITC w.e.f. 01.04.2025. Option to be chosen for respective financial year.
- GST @18% (presently @ 12%) on sale of old and used vehicles including EVs on the margin of supplier, i.e., difference between purchase price / depreciated value and selling price.
- Exemption to RBI regulated payment aggregators
- Change in law recommended in section 17(5) to nullify impact of Supreme Court decision in Safari case.
- Waiver of late fee for Form GSTR 9 and GSTR 9C for FYs 2017-18 to 2022-23
- To improve tax compliance, track and trace mechanism to be introduced for tax evasion prone specified goods.
- Grant of temporary identification number by tax officers to persons, not liable to be registered otherwise.
- Input Service Distribution (ISD) to include inter-state RCM transactions under the ISD w.e.f. 01.04.2025.
- Amendment in law / Rules to provide legal framework for Invoice Management Systems (IMS)
- Procedural rules for internal functioning of GSTAT to be notified after examination.
- No decision on GST on RCM basis on charges collected by municipalities for grant of FSI.
These changes will be effective after law is amended / changes notified / clarifications issued.
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