• UGI USER
  • Sep 10, 2024
  • 6 Likes
  • 0 Comments

Gst reduced on cancer drugs,snacks,insurance review

Why in the news?

The GST Council slashed taxes on cancer drugs and snacks, and formed a GoM to review insurance GST rates, with decisions expected in November.

About the GST Reduction on Cancer Drugs and Snacks:

  • The GST Council reduced the tax rate on cancer drugs from 12% to 5% during its 54th meeting in New Delhi, chaired by Union Finance Minister Nirmala Sitharaman.
  • GST on selected snacks has also been reduced from 18% to 12%, aiming to make these products more affordable.

Group of Ministers to Review Health and Life Insurance GST:

  • A Group of Ministers (GoM) will review GST rates on life and health insurance, with a report expected by the end of October.
  • Decisions on rate reductions will be taken in November’s meeting based on the GoM’s recommendations.

About Goods and Services Tax (GST) Council :

  • Established under the Constitutional (122nd Amendment) Bill, passed in 2016.
  • The GST Council is a constitutional body that provides recommendations to Union and State governments on GST-related matters.
  • Objective: Harmonise tax laws across states, eliminate cascading taxes, simplify tax structure, and reduce compliance costs.

Composition of GST Council:

  •  Chairperson: Union Finance Minister.
  •  Members: Union Minister of State for Finance and Finance Ministers from all states.
  •  Vice-Chairperson: Elected from among the Council members.

Functions of GST Council:

  • Recommends taxes, cesses, and surcharges to be subsumed under GST.
  • Determines goods and services to be subjected to or exempted from GST.
  • Proposes GST rates, thresholds, and special provisions for natural calamities or specific states.
  • Establishes mechanisms to adjudicate disputes between the Government of India and states.

Constitutional Provisions:

  • Article 279A(1): GST Council to be constituted within 60 days of Article 279A commencement.
  • Article 279A(4): Defines the Council’s authority to make recommendations.
  • Article 279A(9): Decisions require a three-fourths majority, with one-third weightage for the Central Government.