GST Council Meet: Decriminalising of 3 offences recommended, no new tax hike added

The Goods and Service Tax (GST) Council has decided to decriminalise certain offences and doubled the threshold for launching prosecution to Rs 2 crore. The decision was taken at a meeting held on Saturday, which was chaired by Finance minister Nirmala Sitharaman. The meeting was held virtually through video conferencing almost after six months after the last one in June.  

Revenue Secretary Sanjay Malhotra said that the GST Council has decided to decriminalise certain offences and doubled the threshold for launching prosecution to Rs 2 crore. 

He added that three kinds of offences were mentioned, which pertained to obstructing or preventing any officers in the discharge of his duties, deliberate tampering with material evidence, and failure to supply information.  

Besides, the threshold limit of tax amount for launching criminal proceedings defined under the GST laws that was increased from Rs 1 crore to Rs 2 crore. This will not cover offences, such as fake invoicing. 

Sitharaman said no new taxes were introduced.  

The GST has been reduced on husk on pulses from 5 per cent to zero. Ethyl alcohol or biofuel- supplied to refineries for blending with motor spirit (petrol) was also cut down to 5 per cent from 18 per cent. 
The revenue secretary said the panel has allowed 5 per cent reduction for blending with petrol by oil marketing companies. “Now this exemption is being extended to refineries as well. This will promote our efforts on blending and reduce our dependence on imported crude and thereby save foreign exchange,” Malhotra said.

At the end of the meeting, the Council officers said that the panel could decide only 8 items of the 15 agenda items due to paucity of time. Sitharaman said that the items not considered included one pertaining to setting up of appellate tribunals for GST. 

The Council decided to regularise the intervening period starting from the date of issuance of Circular (3.08.2022) in respect of GST on ‘husk of pulses including chilka and concentrates including chuni/churi, khanda’ on “ as is basis" on account of genuine doubts. 

It was also decided that no GST is payable where the residential dwelling is rented to a registered person if it is rented it in his/her personal capacity for use as his/her own residence and on his own account and not on account of his business. 

Besides, the Council said incentives paid to banks by Central Government under the scheme for promotion of RuPay Debit Cards and low value BHIM-UPI transactions are in the nature of subsidy and thus not taxable. 

The Council also clarified why SUVs attract the tax applicable. It said the higher rate of compensation cess of 22 per cenr is applicable to motor vehicle fulfilling all four conditions, namely, it is popularly known as SUV, has engine capacity exceeding 1500 cc, length exceeding 4000 mm and a ground clearance of 170 mm or above. 

 (With agency inputs)