After Protests, GST Council Exempts These Institutions From Taxing Research Grants

The GST Council has announced a significant decision to exempt research grants received by central and state universities, as well as institutions with Income Tax exemptions, from Goods and Services Tax (GST). The move applies to both government and private research grants, offering relief to educational institutions across India.

This decision comes after a protests erupted against the imposition of an 18% GST on research grants, especially from the opposition parties. Earlier, Delhi Education Minister Atishi was vocal in her criticism, accusing the central government of both reducing research funding and imposing undue taxes on institutions that independently secure research grants. Atishi specifically highlighted the impact on institutions like IIT Delhi, questioning why research on critical areas such as vehicles, aircraft, and medical equipment should be taxed.

Atishi, alongside Punjab Finance Minister Harpal Singh Cheema, also opposed GST on health insurance and life insurance, particularly for individuals with mental disabilities. They urged the council to reconsider imposing GST on small payments made through gateways and emphasised the importance of supporting research for national development without tax burdens.

The 54th GST Council meeting, held on 9th September 2024, reportedly reviewed several key issues, including potential GST reductions on cancer drugs, exemptions for electricity meter services, and adjustments in real estate and metal industries.