GST Council grants tax relief for millets and molasses

The GST Council has made significant strides in promoting the consumption of protein-rich millet-based flour by granting substantial tax relief. Additionally, the council took steps to establish the long-awaited GST Appellate Tribunal by delineating the qualifications and age requirements for its president and members.

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The GST Council has taken noteworthy measures to encourage the consumption of protein-rich millet-based flour by providing considerable tax relief. Furthermore, the council has initiated the establishment of the long-anticipated GST Appellate Tribunal by outlining the qualifications and age criteria for its president and members. Notably, this encompasses the inclusion of seasoned advocates with at least a decade of experience who can now serve as judicial members within these tribunals.

During its 52nd meeting, the central-state committee, led by Union Finance Minister Nirmala Sitharaman, made the decision to exempt extra-neutral alcohol (ENA) used in the production of alcohol for human consumption from the scope of GST. This move allows individual states the authority to determine the taxation approach for ENA.

Furthermore, the central-state committee resolved to lower the GST rate on molasses. This decision aims to facilitate timely payments to sugarcane farmers within the sugar industry and also decrease the expenses associated with cattle feed production.

The GST rate for prepackaged or labeled flour containing 70% millet by weight has been reduced from 18% to 5%, while loose sales of such flour will be tax-exempt. This decision signifies that the Council has chosen to provide a more substantial tax reduction for these products compared to the recommendations made by the rate fitment committee. The panel had initially suggested exempting powdered millet but had reservations about offering any tax incentives for labeled or branded millet products.

The Council further clarified that in cases involving personal guarantees, when the company does not provide any consideration to the director, whether directly or indirectly, no tax will be levied on the supply of such services.