19 Recommendations of 48th Meeting of GST Council

The 48th meeting of GST Council, held on June 2021, was chaired by the Union Finance Minister Nirmala Sitharaman. The council discussed various issues related to GST, including rate rationalization on COVID-19 related items, compensation to states, among others. Here are the key recommendations made by the council:

GST rate on COVID-19 related items

The GST rate on medical grade oxygen, pulse oximeters, hand sanitizers, and temperature check equipment that are used for COVID-19 relief efforts have been reduced to 5%. Additionally, the council has recommended that the levy of IGST on import of COVID-19 relief material be exempted till 31st August 2021.

Compensation to States

The council has recommended that the Centre borrow Rs. 1.58 lakh crore and distribute it among states to compensate them for the shortfall in GST collections. The council has also extended the tenure of the GST Compensation Cess beyond June 2022, for another five years, till 2026.

Other Recommendations

The Council has recommended exempting Amphotericin B, used for treating black fungus, from GST.
The GST Council has extended the deadline for filing annual returns for FY 2020-21 till 31st August 2021.
The council has recommended setting up a Group of Ministers (GoM) to study the issue of waiver of GST on COVID-19 vaccine, drugs, and other essential items.
The GST Council has recommended that GST on electric vehicles (EVs) be reduced from 12% to 5%.
The council has recommended that the GST rate on maintenance, repair, and overhaul (MRO) services in respect of aircraft be reduced to 5% from the existing 18%.
The GST Council has recommended that the tax rate on drip irrigation systems be reduced from 12% to 5%.
The council has recommended that the GST rate on dried tamarind be reduced from 5% to nil.
The GST Council has recommended that the GST rate on job work services related to diamonds be reduced to 1.5% from the existing 5%.
The council has recommended that the GST rate on supply of buses to the local bodies be reduced from 28% to 18%.
The GST Council has recommended that the GST rate on supply of e-books be reduced from 18% to 5%.
The council has recommended that the GST rate on train coaches be increased from 5% to 12%.
The GST Council has recommended that the GST rate on the supply of cottonseed oil cakes be reduced from 12% to 5%.

Conclusion

The 48th meeting of the GST Council has made several recommendations related to GST rates, compensation to states, and other issues. The council has reduced the GST rate on COVID-19 related items to 5%, among other things. These recommendations are expected to provide relief to businesses and individuals who have been affected by the COVID-19 pandemic and to stimulate economic growth.