GST Council to Consider ITC Relief on Insurance, Catering on Oct 7

The GST Council will meet on October 7 to consider proposals to unblock input tax credit (ITC) on employee insurance, outdoor catering, free samples and expired goods, officials said.
The Law Committee of the GST Council has recommended five amendments to Section 17(5) of the CGST Act to remove ITC blocks on these items, a senior official told businessline.
One key change is omitting life and health insurance and outdoor catering from the blocked list. The official said group insurance policies given by companies to employees are business expenses, and denying credit on them creates an inconsistency now that life and health insurance have been removed from the tax net.
Outdoor catering for business events, conferences and staff functions could also qualify as genuine business expenses, the committee felt.
On free samples, the official said distribution of samples is normal business practice in pharmaceuticals and FMCG, and denying ITC adds to business costs. ITC would also be allowed where goods are written off on expiry as required by law.
The meeting will focus on process reforms rather than rate changes, officials said.
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