The Goods and Services Tax Council will meet on October 7 to take up a set of compliance reforms, including long-pending relief on blocked input tax credits.

The Law Committee has recommended five amendments to Section 17(5) of the CGST Act. If approved, businesses could claim input tax credit on employee life and health insurance, outdoor catering, free samples, and goods that are destroyed or written off. These credits are currently blocked by law.

The recommendations follow years of industry demands, especially from employers who pay for staff insurance but cannot claim the tax paid on it. Tax experts said the change would reduce disputes and lower the effective cost of employee welfare spending.

The question of input tax credit on motor vehicles has been left for the Council to decide. Sources indicated no major rate changes are expected at this meeting, which will focus on process reforms and the implementation of the recent rate rationalisation.