JAISALMER : The GST Council on Saturday decided to formalise a procedure for states to levy special cess to raise money for disaster relief. This was decided after Andhra Pradesh sought the Council’s permission to levy a 1% cess on goods and services in the highest rate bracket of 28%. Andhra Pradesh request for a 1% cess will be referred to a Group of Ministers (GoM) as was done previously for a similar request by Kerala in 2018.At a press conference after the GST Council meeting, Finance Minister Nirmala Sitharaman said that since similar requests have been made earlier as well, “we are of the view that there should be a laid-out procedure to deal with such requests in future”.Besides floods, several states wanted drought to be brought under the definition of disaster, she added. Andhra Pradesh Finance Minister Payyavula Keshav told the media that the state in August and September had faced unprecedented rains and flood, which caused severe financial loss to the state. “…we will need a sum of Rs 15,000 crore to come back to normalcy. Therefore, we requested the Council to allow us to levy a cess of 1%,” said Keshav, adding that most states were supportive of the Andhra’s demand.Meanwhile, the 55th GST Council meeting ended without any major decisions being taken. The much-awaited decision on lowering GST rates on health and life insurance premium has been deferred as the Council was of the view that the issue needs more discussions. Among the changes in tax rates, the Council decided to increase the GST rate from 12% to 18% on sale of all old and used vehicles, including electric vehicles. Caramelised popcorn would attract 18% GST as it comes under sugar confectionery.
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