55th GST Council at Jaisalmer cuts GST on Fortified Rice Kernel to 5%, exempts gene therapy, raises rate on used vehicles to 18%
The GST Council chaired by Finance Minister Nirmala Sitharaman met in Jaisalmer, Rajasthan, on 21 December 2024 and recommended a series of rate changes and clarifications.
Summary
The 55th meeting of the GST Council, chaired by Union Finance Minister Nirmala Sitharaman, was held in Jaisalmer, Rajasthan, on 21 December 2024. The Council recommended reducing the GST rate on Fortified Rice Kernel (FRK) to 5%, exempting gene therapy from GST, and exempting contributions made by general insurance companies from third-party motor premiums to the Motor Vehicle Accident Fund. It recommended raising GST from 12% to 18% on the sale of all old and used vehicles, including EVs (other than those already at 18%), payable on the margin of the supplier. The Council clarified that Autoclaved Aerated Concrete (ACC) blocks with more than 50% fly ash attract 12% GST, and that ready-to-eat popcorn mixed with salt and spices attracts 5% if not pre-packaged and labelled and 12% if pre-packaged and labelled. The GST rate on restaurant services in hotels will be linked to the actual value of supply of accommodation units (above ₹7,500 means 18% with ITC), effective from 1 April 2025.
Key facts
- Meeting
- 55th GST Council, 21 December 2024, Jaisalmer (Rajasthan)
- Chair
- Union Finance Minister Nirmala Sitharaman
- Fortified Rice Kernel
- GST cut to 5%
- Gene therapy
- Exempted from GST
- Motor Vehicle Accident Fund
- Contributions by general insurers from third-party premiums exempted
- Old and used vehicles
- 12% to 18%, on the supplier's margin
- ACC blocks
- More than 50% fly ash: 12% GST
- Popcorn (salt and spices)
- 5% loose; 12% pre-packaged and labelled
- Restaurants in hotels
- Linked to actual value of supply; ₹7,500 threshold; from 1 April 2025
Practice MCQs 4 questions
To what rate did the 55th GST Council (December 2024) recommend reducing GST on Fortified Rice Kernel (FRK)?
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Correct answer: A — 5%
PIB (Finance Ministry): the 55th GST Council recommended reducing the GST rate on Fortified Rice Kernel (FRK), classifiable under 1904, to 5%.
The 55th GST Council recommended raising the GST rate on the sale of all old and used vehicles, including EVs (other than those already at 18%), from 12% to:
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Correct answer: C — 18%
PIB (Finance Ministry): the Council recommended increasing the GST rate from 12% to 18% on the sale of all old and used vehicles, including EVs, other than those already specified at 18%.
According to the 55th GST Council's clarification, Autoclaved Aerated Concrete (ACC) blocks containing more than 50% fly ash attract GST at:
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Correct answer: B — 12%
PIB (Finance Ministry): the Council clarified that ACC blocks containing more than 50% fly ash content fall under HS 6815 and attract 12% GST.
Consider the following recommendations of the 55th GST Council held in Jaisalmer in December 2024: 1. Gene therapy to be fully exempted from GST. 2. Contributions by general insurance companies from third-party motor premiums to the Motor Vehicle Accident Fund to be exempted. 3. The new rule linking the GST rate on restaurant services in hotels to the actual value of supply of rooms to take effect from 1 January 2025. Which of the statements given above are correct?
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Correct answer: D — 1 and 2 only
PIB (Finance Ministry): statements 1 and 2 are correct. Statement 3 is wrong because the changes to restaurant services in hotels are to be effective from 1 April 2025 (01.04.2025).