The pre-Budget meeting was attended by Union Minister of State for Finance Pankaj Chaudhary, Chief Ministers of Goa, Meghalaya, Mizoram, Nagaland, and Sikkim; Deputy Chief Ministers of Bihar, Madhya Pradesh, Odisha, Rajasthan and Telangana;
State Finance Ministers and other Ministers; and Senior Officers from the States and Union Territories (with Legislature) and the Union Government.
Ms Sitharaman, who was retained as Finance Minister by Prime Minister Narendra Modi after the recently held elections, chaired the pre-Budget consultations with the Finance Ministers of states and Union Territories to take their views on board for the upcoming Union Budget 2024-25 here on Saturday.
The maiden session of new Parliament gets underway on Monday with the conventional oath taking by members of the 18th Lok Sabha.
FM also later presided over the 53rd meeting of the GST (Goods & Services Tax) Council on Saturday of which the finance ministers of states and UTs are also members.
The GST Council is likely to deliberate on key issues such as the taxes on fertilisers and the inputs of chemicals used for making fertilisers and taxation on online gaming. The need for an amendment to overrule retrospective tax demands and a possible exemption for reinsurance is also likely to be taken up.
The council may discuss the recommendations made by the Standing Committee on Chemicals and Fertilisers to reduce GST on raw materials used to manufacture fertiliser in order to correct the inverted duty structure.
At present GST at a rate of five per cent is charged on fertilisers, while raw materials like Sulphuric Acid and Ammonia face a higher GST of 18 per cent.
A reduction in tax on the import of maintenance, repair and operations (MRO) services for foreign airlines in India which are currently taxed at 18 per cent may also be taken up for consideration.
The GST meeting marks a significant gathering since October 7, 2023, when the council, also chaired by Sitharaman, made decisions including the imposition of a 28% GST on online gaming, casinos, and horse racing.
Amidst ongoing discussions and postponements, the council now reconvenes to address crucial issues under Sitharaman's stewardship once more.
Additionally, the Council will clarify GST applicability on co-insurance, where multiple insurers share liability in a proportionate manner. Currently, only one insurer pays GST, leading to industry confusion and non-payment issues.
Notices have been issued to several insurers, including Star Health and ICICI Lombard, for non-payment of GST on co-insurance and reinsurance premiums. The Council aims to address these ambiguities to ensure proper tax compliance in the insurance sector.
The online gaming sector, currently subject to a 28 percent GST on the full face value of bets, will not see the anticipated review of this levy at the upcoming GST Council meeting on June 22.
Initially scheduled for review six months after the implementation on October 1, 2023, the discussion aimed to reassess the tax structure for the growing industry.
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