GST Council decides to slash rates on millet products, molasses: FM

The GST Council on Saturday decided to levy a lower 5 per cent tax on millet-based flour when sold in pre-packaged and labelled form, Finance Minister Nirmala Sitharaman said.

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 52nd GST Council meeting, chaired by Union finance minister and comprising state counterparts, also 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 President and members of GSTAT.

The GST Council also decided to reduce GST on molasses to 5 per cent, from 18 per cent, and exempt alcohol for human consumption from the levy.

Chhattisgarh Deputy Chief Minister T S Singh Deo, who is a member of the GST Council, said extra neutral alcohol (ENA) for industrial use will continue to attract Goods and Services Tax (GST).

"ENA (potable alcohol) for human consumption will be exempt from GST and the same will be communicated to the Supreme Court," Deo told reporters after the 52nd GST Council meeting.

The tax rate on molasses, a by-product of sugarcane and used as raw material for alcohol production, has been reduced to 5 per cent from 18 per cent currently, Deo added.

He further said that some states like Delhi and Goa raised the issue of online gaming companies facing GST demand notice for alleged evasion.

"There were discussion on charges (tax demand notice) on these companies retrospectively. Because DGGI is an independent body, there cannot be any interference. The (GST Council) chairperson said she would make clarifications available to DGGI, if required," Deo added.

The GST Council on Saturday clarified that guarantees provided by corporates to their subsidiaries will attract an 18 per cent GST, while no tax will be levied if a personal guarantee is given by a director to the company.

The council, chaired by Union Finance Minister Nirmala Sitharaman and comprising state ministers, also cut the GST rate on molasses to 5 per cent from 28 per cent.

It also 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 Goods and Services Tax (GST), while ENA for industrial use will be taxed at 18 per cent.