Press Release
The GST Council, in its 31st meeting held on 22 December 2018 in New Delhi, approved a series of important decisions relating to GST rates, exemptions, input tax credit treatment, and clarifications on various services to reduce tax burden and remove interpretational ambiguities. Key relief measures included reduction of GST on cinema tickets to 18 percent for tickets priced above Rs. 100 and 12 percent for tickets priced up to Rs. 100, reduction of GST on third-party insurance premiums for goods-carrying vehicles from 18 percent to 12 percent, and exemption of banking services provided to Jan Dhan account holders. Several public interest and social sector services were exempted, including services by rehabilitation professionals at recognised institutions, services provided by banks under government schemes, and certain government guarantee-related services. The Council also rationalised the reverse charge mechanism by extending parity to Parliament and State legislatures, bringing security services and specified banking facilitation services under RCM, and exempting services provided by goods transport agencies to government entities registered only for TDS purposes. A number of clarifications were issued to address long-standing disputes, including GST exemption for degrees awarded by IIMs, exemption of services provided by international financial institutions such as IFC and ADB, tax treatment of printing services, leasing arrangements by oil marketing companies, taxation of RBI incentives to banks, and scope of multi-modal transport. Further clarity was provided on taxation of food and beverage supplies by educational institutions, warehousing services for agricultural produce, and banking charges collected through intermediaries. These decisions were aimed at simplifying compliance, ensuring uniform tax treatment across sectors, and providing clarity to taxpayers, with implementation to follow through notifications and circulars.
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