In a recent decision by the GST Council, universities and research centres set up under Central & State Governments Acts or those availing income tax Exemption shall exempt from paying GST on research funds. This ruling, made in the Council's latest meeting on Monday, ensures that these institutions will not face GST charges on government and private research grants.
This was after Delhi Minister Atishi strongly opposed any move to tax research grants at the GST Council meeting. On Sunday, Atishi had condemned the central government on the decision to impose GST on research grants saying no country levies tax on the grants. She drew attention to the fact that the University of Punjab and IIT Delhi, along with others had received show cause notice for non-payment of GST on grants received during the period 2017 to 2024.
Atishi stated that the central government's move to cap the quantum of research grants and charge GST on self-generated funds from private or foreign institutions was unjust. Her position was to defend other institutions of learning from incurring unnecessary expenses.
The Council which consists of the Union Finance Minister and the ministers of all the States and Union Territories was formed in the year 2017 for the purpose of taking all necessary decisions relating to GST. The most recent decision of the Council is consistent with its goal of reducing the tax complexity, which is served by the new single regime the previously complex indirect tax.
This exemption will be beneficial for educational institutions thus aiding them to better manage research grants without being burdened by GST payments. The move seeks to confirm the council's stand it has for the academic and research community as it further polishes the GST framework.
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