The 55th meeting of the Goods and Services Tax (GST) Council, chaired by Union Finance Minister Nirmala Sitharaman, convened today to deliberate on pivotal tax reforms aimed at bolstering public health and nutrition.
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GST Exemption for Life-Saving Gene Therapy

In a landmark decision, the Council has granted a full exemption from GST on gene therapy, a critical treatment modality for cancer patients. This move is anticipated to substantially reduce the financial burden on individuals undergoing such advanced medical procedures.
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Reduction of GST on Fortified Rice Kernels

Addressing nutritional deficiencies among economically weaker sections, the Council has approved a reduction in GST rates on Fortified Rice Kernels (FRK) from the existing 18% to 5%. This reduction applies to FRK classified under HSN code 1904 and is expected to facilitate the wider distribution of nutrient-enriched rice through the Public Distribution System (PDS).
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Deferral of Decisions on Insurance and Food Delivery Services

The Council deferred decisions on reducing GST rates for health and term insurance policies, as well as for food delivery services, citing the need for further consultations. This postponement indicates the Council’s commitment to thorough deliberation before implementing tax reforms in these sectors.
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Exclusion of Aviation Turbine Fuel from GST

Proposals to include Aviation Turbine Fuel (ATF) under the GST regime were deliberated upon; however, the Council, considering the concerns of various states, decided against this inclusion at present. This decision reflects the complexities involved in integrating petroleum products into the GST framework.
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Additional Tax Reforms and Clarifications

The Council also recommended several other tax reforms, including:

Exemption of GST on Contributions to Motor Vehicle Accident Fund: Contributions made by general insurance companies from third-party motor vehicle premiums to the Motor Vehicle Accident Fund will now be exempt from GST. This fund provides compensation and cashless treatment to road accident victims.
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Clarification on Penal Charges by Banks and NBFCs: The Council clarified that penal charges levied by banks and Non-Banking Financial Companies (NBFCs) for non-compliance with loan terms are not subject to GST, providing relief to borrowers facing such penalties.
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Simplification of Voucher Transactions: It was clarified that transactions involving vouchers are neither considered supply of goods nor services, thereby exempting them from GST. The provisions related to vouchers are also being simplified to ensure clarity and ease of compliance.
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These decisions underscore the GST Council’s commitment to refining the tax structure in a manner that supports public health initiatives and addresses the nutritional needs of the population, while ensuring clarity and fairness in tax administration.