55th GST Council Meeting: No GST payable on penal charges levied & collected by banks & NBFCs from borrowers for non-compliance, says Nirmala Sitharaman

The all-powerful GST Council on Saturday announced a host of decisions on rates impacting a variety of areas including certain snacks, electric vehicles (EVs) and construction materials. Finance and Corporate Affairs Minister Nirmala Sitharaman chaired the 55th meeting of the GST Council in Jaisalmer, Rajasthan. Union Minister for State for Finance Pankaj Chaudhary along with Chief Ministers and Deputy Chief Ministers of a number of states and Union Territories were present in the meeting, besides regional finance ministers.

Here are highlights from a post-GST Council meeting press conference on December 21:

Union Finance and Corporate Affairs Nirmala Sitharaman

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• Gene therapy now exempted from GST

• GST Council has recommended an amendment to the definition of pre-packaged and labelled items

• No GST payable on penal charges levied & collected by banks & NBFCs from borrowers for non-compliance

• No decision has been made on GST on insurance products (urges media & public not to speculate); many inputs including IRDAI comments awaited
• The matter related to quick commerce/e-commerce related food delivery platforms and applicable charges are discussed but no decision yet (please do not speculate)
  • The matter has been referred to the Group of Ministers

No decision on Floor Space Index in real estate

Group of Ministers on rate rationalisation has not yet finalised its report yet, so the decision stands postponed for now

No timeline has been given on compensation cess

​The panel postponed a decision on reducing taxes on health and life insurance, while the much talked about GoM recommendation of rate rejig in 148 items was not tabled.

Catch highlights of the 55th GST Council meeting here

The GST Council meets periodically to deliberate and decide on various issues related to the indirect tax. Over the years, it has been instrumental in deciding key issues related to the GST such as tax rates, exemptions, thresholds and administrative procedures.The panel takes a consensus-based approach to decide on any aspect being discussed.

The first GST Council meeting was held in September 2016.