In a significant move to simplify the tax regime and combat fraud, the GST Council announced a series of exemptions and reforms on Saturday.
Key Exemptions Announced
The council’s decisions include exempting hostel fees, platform tickets, railway waiting room charges, and golf cart fees from the Goods and Services Tax (GST). Additionally, employee stock options will now be exempt from GST, providing relief to both educational institutions and corporate employees.
Extension of Hostel Fee Exemption
Previously, only hostels run by educational institutions enjoyed tax exemptions. However, Finance Minister Nirmala Sitharaman clarified that this exemption will now cover all hostels. To be eligible, the monthly charges must be under Rs 20,000 per person, and the occupant must stay for at least 90 days. This broader exemption is anticipated to benefit thousands of students and working professionals living in paying guest accommodations.
Measures to Curb Fraud
To address the issue of fraud by bogus entities, the council has introduced a revamped system for tax regime registration. This reform is expected to enhance the accuracy and reliability of the GST registration process, reducing the potential for fraudulent activities.
Additional Relief Measures
Further relief has been provided for corporate guarantees and reinsurance, with specific clarifications issued to streamline these processes. Additionally, e-commerce companies will benefit from a reduction in the tax collected at source on net taxable supplies, which has been halved to 0.5%. This reduction aims to lower the tax burden on e-commerce transactions, facilitating smoother operations for online businesses.
