GST Council spices things up: Here's what got cheaper overnight in India

The GST Council’s meeting on Monday added some flavor to the Indian tax system, announcing significant cuts aimed at making essential services and goods more affordable. Among the key reductions were tax cuts on cancer drugs, helicopter travel, and snacks like namkeen.

In a series of decisions, the Council reduced GST on select cancer medications to 5 per cent, cut the levy on fried snacks (namkeen) from 18 per cent to 12 per cent, and lowered the tax on shared helicopter rides to 5 per cent.

• Drugs: Among the most significant decisions, the reduction of GST on life-saving cancer drugs like Trastuzumab Deruxtecan, Osimertinib, and Durvalumab from 12 per cent to 5 per cent was praised as a step towards making these treatments more accessible. Industry experts highlighted the importance of this move, which complements the customs duty exemption for cancer drugs announced earlier this year. "With the increasing burden of chronic diseases in India, this is a move toward making life-saving drugs accessible and improving health outcomes," said Sudarshan Jain, secretary general of the Indian Pharmaceutical Alliance.

• R&D activities: The Council also agreed to exempt research and development (R&D) activities funded by private and public sources, including universities, from GST, marking a win for educational institutions engaged in R&D under central or state laws.

• Helicopter travel booking: The decision to reduce GST on helicopter travel booked on a 'seat-share' basis to 5 per cent will benefit travelers to popular pilgrimage destinations like Kedarnath-Badrinath and Vaishno Devi. However, chartered helicopter services will continue to attract the higher 18 per cent GST.
• Namkeens (Snacks): The GST rate has been reduced prospectively from 18 per cent to 12 per cent for namkeens and savoury items.

In addition to these tax reductions, the Council deferred decisions on two key issues: lowering GST on health and life insurance and extending the compensation cess beyond January 2026. These matters were referred to two ministerial panels for further consideration. The panel on insurance, led by Bihar Deputy Chief Minister Samrat Chaudhary, will review the exemption thresholds, treatment of senior citizens, and group insurance sales by resident welfare associations, with recommendations expected by the end of October.

The Council also clarified that uncooked or unfried snack pellets will attract a 5 per cent tax, while increasing the GST on car and motorcycle seats from 18 per cent to 28 per cent. Roof-mounted package unit air conditioners used in railways were also moved into the highest GST slab. The decision on taxing electric vehicle (EV) charging stations was postponed.

However, there was no relief for payment aggregators, who had launched a social media campaign seeking exemptions after receiving tax notices last month. Revenue Secretary Sanjay Malhotra confirmed that the exemption currently only applies to banks.

As part of its broader agenda, the Council also aligned preferential location charges (PLC) for residential, commercial, and industrial properties with the same GST rate applicable to construction services.

(With inputs from TOI)