• The 52nd GST Council meeting, chaired by Union Finance Minister Nirmala Sitharaman, decided to cap the maximum age of president and members of the GST Appellate Tribunal (GSTAT).

• The GSTAT president will have a maximum age cap of 70 years, while the limit for members will be 67 years. This is a change from the earlier age limit of 67 and 65 years, respectively, for the GSTAT president and members.

Other key decisions of the GST Council:

• It decided to levy a lower 5 per cent tax on millet-based flour when sold in pre-packaged and labelled form. Flour, containing at least 70 per cent millets, will attract zero per cent GST if sold loose and 5 per cent if sold pre-packaged and labelled.

• The GST Council cut the GST rate on molasses to 5 per cent from 28 per cent. The reduction in GST on molasses will benefit sugarcane farmers and enable their dues to be cleared faster because more money will be left in the hands of the mills.

• It ceded the right to tax Extra Neutral Alcohol (raw product for making alcohol for human consumption) to the states. Accordingly, ENA used for human consumption will be exempt from GST, while ENA for industrial use will be taxed at 18 per cent.

• The Council clarified that guarantees provided by corporates to their subsidiaries will attract an 18 per cent GST, but no tax will be levied on the personal guarantee given by a director of a company raising loans from the market. 

GST Council

• The introduction of the Goods and Services Tax (GST) regime in the country in 2017 was a very significant step in the field of indirect tax reforms in India. By amalgamating a large number of central and state taxes into a single tax, the aim was to mitigate cascading or double taxation in a major way and pave the way for a common national market.

• Goods and Services Tax Council is a constitutional body for making recommendations to the Union and state governments on issues related to GST. 

• The GST Council is chaired by the Union finance minister.

• As per Article 279A of the amended Constitution, the GST Council, which will be a joint forum of the Centre and the states, shall consist of the following members:

a) The Union finance minister (chairperson).

b) The Union minister of state in charge of revenue or finance.

c) The minister in charge of finance or taxation or any other minister nominated by each state government.

Every decision of the GST Council shall be taken at a meeting, by a majority of not less than three-fourths of the weighted votes of the members present and voting, in accordance with the following principles:

i) The vote of the central government shall have a weightage of one-third of the total votes cast, and

ii) The votes of all the state governments taken together shall have a weightage of two-thirds of the total votes cast.

The Council is empowered to make recommendations to the Union and the States on:

1) The taxes, cesses and surcharges levied by the Union, the states and the local bodies which may be subsumed in the goods and services tax.

2) The goods and services that may be subjected to, or exempted from the goods and services tax.

3) Model Goods and Services Tax Laws, principles of levy, apportionment of Integrated Goods and Services Tax and the principles that govern the place of supply.

4) The threshold limit of turnover below which goods and services may be exempted from goods and services tax.

5) The rates including floor rates with bands of goods and services tax.

6) Any special rate or rates for a specified period, to raise additional resources during any natural calamity or disaster.

7) Special provision with respect to the states of Arunachal Pradesh, Assam, Jammu & Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh and Uttarakhand.

8) The date on which GST shall be levied on petroleum crude, high speed diesel, motor spirit (petrol), natural gas and aviation turbine fuel.

9) Any other matter relating to the goods and services tax, as the Council may decide.

The mechanism of GST Council would ensure harmonisation on different aspects of GST between the Centre and the states as well as amongst the states.

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