NEW DELHI: Claiming that central government treating research as a business rather than a critical investment, Delhi Finance Minister Atishi on Sunday said she will raise the issue of imposition of GST on research grants procured by educational institutions in the 54th GST Council meeting.
“The (central) government has reduced budget allocation for research from 2014 to 2024. If an educational institution gets research grant from a private entity, the government imposes 18 per cent GST, which is not justified. We will oppose it,” Atishi said while addressing a press conference.
The minister stated that taxes are not imposed on research grants in foreign countries such as the US and UK.
Over other issues, Atishi said she will raise the imposition of GST on online transactions below Rs 2,000, in the 54th meeting of the GST Council to be held on Monday.
“The central government is coming up with a proposal to impose GST on online transactions of less than Rs 2000. No GST was earlier imposed on such small transactions. We will oppose this proposal,” she added. Recently, the Indian Institute of Technology Delhi has reportedly been issued a show-cause notice by the directorate general of Goods and Services Tax (GST) Intelligence, demanding `120 crore in tax on research grants received between 2017 and 2022, along with interest and penalties.
A senior official has called the notice unfortunate and said they plan to contest it, arguing that GST should not apply to government-funded research. The official said that research should be encouraged and supported, not treated as a taxable entity. The GST Council on Monday is expected to deliberate on a host of issues, including taxation of insurance premium, GoM’s suggestions on rate rationalisation, and a status report on online gaming, according to sources.
At the meeting, the Fitment Committee, comprising central and state tax officials, will present a report on GST levied on life, health and reinsurance premiums and their revenue implications.
The GST Council is chaired by Finance Minister Nirmala Sitharaman and comprises state ministers.