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GST Council Meet: Tax Reduction on Cancer Medicines and Snacks, Know What’s Cheaper and What’s Expensive

GST Council Meet: In the 54th GST Council meeting, chaired by Finance Minister Nirmala Sitharaman, several significant decisions were made. During the meeting, the formation of a Group of Ministers (GoM) to review the 18% GST rate on insurance was announced. The Finance Minister stated, “We have asked them to submit their report by the end of October, and the GST Council will make a final decision in November based on their recommendations.”

One of the key decisions was the reduction of GST on cancer medicines from 12% to 5%. Additionally, the GST rate on snacks and savory food items has been reduced from 18% to 12%. The council also discussed lowering the GST on health insurance premiums and the imposition of tax on online payments above ₹2,000. Furthermore, those availing helicopter services for religious tourism will now pay only 5% GST instead of the previous 18%.

Key Decisions of the GST Council Meeting:

Here are the important decisions taken during the meeting chaired by Finance Minister Nirmala Sitharaman:

Formation of GoM on Health Insurance

The GST Council has formed a Group of Ministers (GoM) to review the GST rates on health and medical insurance. This group will submit its report by the end of October, and the Council will make a final decision in November

GST Reduction on Cancer Medicines:

To lower the cost of cancer treatment, the GST on cancer drugs has been reduced from 12% to 5%.

Snacks Made Cheaper:

The GST rate on snacks and some other savory food items has been reduced from 18% to 12%, providing relief to consumers and lowering the prices of these products.

Relief for Foreign Airlines:

The GST Council has exempted foreign airlines from GST on imported services, offering significant relief to these companies.

GoM on Cess Collection:

The Council discussed cess collection and projected that by March 2026, total cess collection could reach ₹8.66 lakh crore. After debt repayment, an estimated surplus of ₹40,000 crore is expected.

B2C GST Invoicing:

From October 1, Business-to-Customer (B2C) GST invoicing will be implemented, enhancing transparency and streamlining the taxation process.

Cheaper Religious Tourism:

Relief has been provided for those traveling for religious purposes, with GST on helicopter services for religious tourism reduced from 18% to 5%. Sharing helicopter services will attract 5% GST, while chartered services will be subject to 18%.

Increase in GST on Car Seats:

The GST rate on car seats has been increased from 18% to 28%, which may lead to a rise in their prices.

Boost in Revenue from Online Gaming GST

The Finance Minister also highlighted a 412% increase in revenue following the announcement of GST on online gaming, as per the report presented by the Fitment Committee.

Research Grant GST Issue Sent to Committee

The issue of GST on research grants received by educational institutions has been referred to the Fitment Committee for review. The GST Council will take a decision after the committee submits its report.

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