Infosys and Foreign Airlines likely to get GST Relief

The Centre is apparently considering providing GST relief to Infosys, foreign shipping lines, and foreign airlines. According to a report, the proposed reforms, which could be debated at the upcoming GST Council meeting on September 9, are part of broader attempts to promote transparency and ease of doing business in the service sector.

Recently, the Directorate General of Goods and Services Tax Intelligence (DGGI) sent notices to Infosys, India’s second-largest IT company, as well as several foreign airlines. The notices are for unpaid taxes on the import of services by Indian subsidiaries from their head offices.

The government is apparently considering changing a June directive to address these concerns. It was unable to independently verify the report regarding the anticipated GST relief.

Earlier, the DGGI issued show-cause notices to ten foreign airlines, including British Airways, Lufthansa, and Emirates, for over Rs.10,000 crore in unpaid taxes. The problem arises from taxes levied on services imported by Indian branches from their international headquarters.

Meanwhile, the reconstituted Group of Ministers (GoM) on GST rate rationalisation met for the first time on Thursday. West Bengal Finance Minister Chandrima Bhattacharya said she had asked for a reduction in the 18% GST rate on life and health insurance premiums.

“I have submitted a request to reduce GST on life and health insurance. I’ve been told that the fitment committee is looking into it,” she explained.

Karnataka Revenue Minister Krishna Byre Gowda stated, “We have discussed the issue of lowering GST rates on insurance; we have requested more information on it.”

However, he stated that no member of the rate rationalisation committee is currently in favour of modifying or reducing the number of existing GST slabs.

According to GoM sources, this was the first meeting of the reconstituted panel, and no decisions have been taken regarding slab reductions, GST rate cuts on specific commodities, or lowering the GST rate on life and health insurance premiums.

The GST Council’s 54th meeting is likely to address these concerns, as well as others like tax slab reductions and rate rationalization.