GST Council meet: FM announces reduced cess for merchant exporters and lower GST on fortified rice kernels

In order to support the export sector, the GST Council has reduced the compensation cess on supplies to merchant exporters to 0.1%.

This reduction is expected to provide exporters with increased working capital.

The Council also provided clarity on the taxation of ACC blocks containing 50% fly ash, confirming that these products will attract 12% GST.

In a decision that will benefit the agricultural sector, black pepper and raisins, when supplied by an agriculturalist, will not be liable for GST.

The definition of pre-packaged and labeled items has also been amended, aligning it more closely with retail sales to ensure uniformity in GST application across these products.

Additionally, the GST on fortified rice kernels has been reduced to 5%.

In other GST-related updates, the Council issued a clarification on the taxability of popcorn.

According to the clarification, ready-to-eat popcorn will be taxed at 5%, pre-packaged popcorn will be subject to a 12% GST, and caramel popcorn will attract an 18% GST.

The department believes that this classification will eliminate confusion around the tax liability on popcorn products, sources said.

Catch all GST Council meet related updates here