The GST Council on Saturday strongly recommended decriminalising a few certain offences which include deliberate tampering of material evidence and hike in the threshold of tax amount for launching prosecution from Rs 1 crore to Rs 2 crore, except for the offence of issuance of invoices without supply of goods or services or both.

The Council also recommended reducing the compounding amount from the present range of 50 per cent to 150 per cent of tax amount to the range of 25 per cent to 100 per cent.

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The measures for facilitation of trade also included recommendation on decriminalising certain offences including obstruction or preventing any officer in discharge of his duties; deliberate tampering of material evidence and failure to supply the information.

Speaking on the deliberations at the Council’s meeting, Union Finance Minister, Nirmala Sitharaman, said no new taxes have been brought.

The 48th GST Council met under the Chairmanship of Union Minister for Finance & Corporate Affairs, Nirmala Sitharaman, via virtual mode here. The meeting was also attended by Union Minister of State for Finance, Pankaj Choudhary, besides Finance Ministers of states & UTs (with legislature) and senior officers of the Ministry of Finance & States/ UTs.

“In this 48th GST Council Meeting, there has not been any tax increase on any item. No new taxation has been brought in. Everything that has been done is to issue clarifications, where ambiguity of interpretations prevailed,” Sitharaman said at the conclusion of the meeting.

At the start of the press conference here after the GST Council Meeting, the Union Finance Minister, said as many as 15 items were on agenda during the GST Council meeting, of which 8 were completed, and the remaining will be carried forward to the next council meeting.

“We completed 8 of the agenda points. There were 2 GoM issues which needed to be discussed but could not be taken up, which were related to the capacity-based taxation on tobacco and gutkha, the other relating to setting up of a (GST) tribunal,” she said.

Revenue Secretary, Sanjay Malhotra, who was present,  said, “a major path-breaking recommendation with regard to decriminalising certain offences,… three kinds of offences, were taken. They pertain to obstructing or preventing any officers in the discharge of his duties, deliberate tampering of material evidence, and failure to supply information.”

The other major decisions taken at the meeting was regarding the threshold limit of tax amount for launching prosecution on any criminal offence defined under the GST laws that has been increased from Rs 1 crore to Rs 2 crore, Malhotra said.

This, however, would not be applicable to those offences such as fake invoicing.

Moreover, GST rates on pulses husk and knives have been reduced from 5 per cent to nil. GST on ethyl alcohol for the purpose of blending of ethanol has been exempted. Earlier, it was taxed at 18 per cent.

“Already we have allowed a 5 per cent reduced rate for blending with petrol by oil marketing companies. Now this exemption is being extended to refineries as well. This will promote the efforts on blending and reduce the dependence on imported crude and thereby save precious foreign exchange,” the Revenue Secretary said.

The Council has clarified on what constitutes an SUV and the tax applicable for such categories of automobiles. It clarified that the vehicle SUVs with an engine capacity exceeding 1,500 cc and length exceeding 4,000 mm with a ground clearance of 170 mm or above will attract a 22 per cent compensation cess.

Malhotra said GST on online gaming and casinos was not discussed as the report of a Group of Ministers (GoM) on the issue submitted its report only a couple of days back.

It was also clarified that goods falling in the lower rate category of 5 per cent under schedule I of notification No. 1/2017-CTR imported for petroleum operations will attract a lower rate of 5 per cent and the rate of 12 per cent shall be applicable only if the general rate is more than 12 per cent.

As a relief measure, 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 also said that no GST is payable, where the residential dwelling is rented to a registered person, if it is rented it in his or her personal capacity for use as his or her own residence and on his own account and not on account of his business.