The CBIC has issued various Notifications dated 16.01.2025, to give effect recommendations relating to changes in GST rates on Goods and Services,  Exemptions on goods and services and changes with respect to reverse charge mechanism.

These Notifications are as under:

A. Changes with respect to Goods:

i. Change in Rate – Notification No. 01/2025- Central Tax (Rate) 

• An New Entry No. 98B has been inserted in Schedule I-2.5%, to reduce the GST rate on Fortified Rice Kernels (FRK) classifiable under Heading 1904 from 9%. Therefore, GST rate reduced 5% from 18%.
• Amendment in the definition of ‘pre-packaged and labelled’ – To cover all commodities that are intended for retail sale and containing not more than 25 kg or 25 litre, which are ‘pre-packed’ as defined under the Legal Metrology Act, or a label affixed thereto is required to bear the declarations under the provisions of the Act and rules.

This Notification shall have an immediate effect i.e. 16.01.2025.

Similar Notifications have been issued under Union Territory Tax (Rate) and Integrated Tax (Rate) vide Notification No. 01/2025- Union Territory Tax (Rate) and Notification No. 01/2025- Integrated Tax (Rate) respectively.

The Complete Notification can be accessed at https://taxo.online/wp-content/uploads/2025/01/ctr01-2025.pdf

ii. Exemption on goods – Notification No. 02/2025- Central Tax (Rate) 

• An New Entry 105A has been inserted in Notification No. 02/2017-Central Tax (Rate) to fully exempt Gene Therapy from GST.

This Notification shall have an immediate effect i.e. 16.01.2025.

Similar Notifications have been issued under Union Territory Tax (Rate) and Integrated Tax (Rate) vide Notification No. 02/2025- Union Territory Tax (Rate) and Notification No. 02/2025- Integrated Tax (Rate) respectively.

The Complete Notification can be accessed at https://taxo.online/wp-content/uploads/2025/01/ctr02-2025-2.pdf

iii. Concessional rate of Tax  – Notification No. 03/2025 – Central Tax (Rate)

Amendment has been made in NN. 39/2017-Central Tax(Rate) where Concessional 5% GST rate had been notified on food inputs of food preparations under HSN 19 or 21 that are supplied for food preparations intended for free distribution to economically weaker sections under a government program subject to the existing conditions.

This Notification shall have an immediate effect i.e. 16.01.2025.

Similar Notifications have been issued under Union Territory Tax (Rate) and Integrated Tax (Rate) vide Notification No. 03/2025- Union Territory Tax (Rate) and Notification No. 03/2025- Integrated Tax (Rate) respectively.

The Complete Notification can be accessed at https://taxo.online/wp-content/uploads/2025/01/ctr03-2025.pdf

iv. Change in rate on Sale of all old and used vehicles including electric vehicles (EVs) except categories which already taxed at 18% – Notification No. 04/2025 – Central Tax (Rate)

Amendment made in Notification No. 8/2018-Central Tax (Rate), to increase the GST rate from 12% to 18% on sale of all old and used vehicles, including EVs other than those specified at 18%. This is to provide a uniform tax rate of 18% which were previously taxed at 12%, including old EVs bracket when resold by businesses.

This Notification shall have an immediate effect i.e. 16.01.2025.

Similar Notifications have been issued under Union Territory Tax (Rate) and Integrated Tax (Rate) vide Notification No. 04/2025- Union Territory Tax (Rate) and Notification No. 04/2025- Integrated Tax (Rate) respectively.

The Complete Notification can be accessed at https://taxo.online/wp-content/uploads/2025/01/ctr04-2025.pdf

B. Concessional Compensation Cess on supply of taxable goods for export – Notification No. 01/2025 – Compensation Cess (Rate)

Scope of Exemption: The notification exempts the intra-state and inter-state supply of taxable goods from the compensation cess. The exemption applies to the extent the cess exceeds 0.1%.

Eligibility: The supplier and recipient must both be registered under GST. The supply must be made explicitly for export purposes.

Conditions for Concessional Cess: 

• The supplier must issue a tax invoice for the goods supplied.
• The recipient must export the goods within 90 days from the date of issue of the tax invoice.

Goods Movement:

The goods must be moved:

• Directly to a port, inland container depot, airport, or land customs station for export, or
• To a registered warehouse, from where they will be moved to the export location.

Aggregation of Supplies:

If goods are procured from multiple suppliers, they must first be moved to a registered warehouse. After aggregation, they can be sent to the export location.

Non-Compliance:

If the goods are not exported within 90 days of the tax invoice date, the supplier is ineligible for the concessional cess rate.

This Notification shall have an immediate effect i.e. 16.01.2025.

The Complete Notification can be accessed at https://taxo.online/wp-content/uploads/2025/01/cess01-2025.pdf

C. Changes with respect to Services:

i. Change in GST Structure on Hotel Accommodation Services – Notification No. 05/2025 – Central Tax (Rate)

• A new definition for “Specified Premises” has been introduced, which applies to financial years.
  • Category (a): Premises that provided hotel accommodation in the preceding financial year, where the value of any unit of accommodation exceeded ₹7,500 per unit per day or equivalent.
  • Category (b): Premises declared as “specified premises” by a registered person supplying hotel accommodation services. Such declarations must be made between January 1 and March 31 of the preceding financial year.
  • Category (c): Premises declared as “specified premises” by a person applying for GST registration. This declaration must be filed within 15 days of receiving acknowledgment for the registration application.

The amendment ensures clarity in defining “Specified Premises” and provides a structured process for declarations, reflecting the government's intent to refine tax applicability and reporting mechanisms.

• Annexure VII has been inserted – For OPT-IN DECLARATION FOR REGISTERED PERSON (Declaration by a registered person supplying hotel accommodation service before the jurisdictional GST authority declaring the premises to be a ‘specified premises’). Such declarations hall be filed by a
  registered person on or after 1st of January of the preceding Financial Year but not later than 31st of March of the preceding Financial Year.
• Annexure VIII has been inserted – FOR OPT-IN DECLARATION FOR PERSON APPLYING FOR REGISTRATION (Declaration by a person applying for registration before the jurisdictional GST authority declaring the premises to be a ‘specified premises’). 
• Annexure IX has been inserted – OPT-OUT DECLARATION (Declaration by a registered supplier of hotel accommodation service before the jurisdictional GST authority declaring the premises as not a ‘specified premises’). Such declarations declaring g the premises as not a ‘specified premises’, for a Financial Year, shall be filed on or after 1st of January of the preceding Financial Year but not later than 31st of March of the preceding Financial Year.

This Notification shall have an immediate effect i.e. 01.04.2025.

Similar Notifications have been issued under Union Territory Tax (Rate) and Integrated Tax (Rate) vide Notification No. 05/2025- Union Territory Tax (Rate) and Notification No. 05/2025- Integrated Tax (Rate) respectively.

The Complete Notification can be accessed at https://taxo.online/wp-content/uploads/2025/01/ctr05-2025.pdf

ii. Exemption on Services – Notification No. 06/2025 – Central Tax (Rate)

• Exemption on contributions made by general insurance companies from the third-party motor vehicle premiums to the Motor Vehicle Accident Fund ( MVA Fund) – An New Entry 36B has been inserted under NN. 12/2017-Central Tax (Rate).
• Changes made in Entry No. 25A of the NN. 12/2017-Central Tax (Rate), to change made in words “transmission and distribution” to “transmission or distribution”
• To provide exemption on services provided by “a training partner approved by the National Skill Development Corporation” in relation to the services as provided under Entry 69 of NN. 12/2017-Central Tax (Rate).

Similar Notifications have been issued under Union Territory Tax (Rate) and Integrated Tax (Rate) vide Notification No. 06/2025- Union Territory Tax (Rate) and Notification No. 06/2025- Integrated Tax (Rate) respectively.

The Complete Notification can be accessed at https://taxo.online/wp-content/uploads/2025/01/ctr06-2025.pdf

iii. Changes w.r.t. Reverse charge mechanism on services – Notification No. 07/2025 – Central Tax (Rate)

• Sponsorship services provided by the body corporates: Amended Entry No. 4 of NN. 13/2017-Central Tax (Rate) to provide that Sponsorship services provided by the body corporates would be subject to Forward charge. Body corporate has been excluded now in RCM Notification. Earlier, supply of sponsorship by any person to any body corporate or partnership firm located in the taxable territory is chargeable to GST under Reverse Charge Mechanism (RCM). 
• Renting of Any commercial/ immovable property (other than residential dwelling) by unregistered person – To Exclude taxpayers registered under the Composition Levy Scheme from the purview of the Reverse Charge Mechanism (RCM) for renting of commercial/immovable property (other than residential dwellings) under Entry 5AB.

Similar Notifications have been issued under Union Territory Tax (Rate) and Integrated Tax (Rate) vide Notification No. 07/2025- Union Territory Tax (Rate) and Notification No. 07/2025- Integrated Tax (Rate) respectively.

The Complete Notification can be accessed at https://taxo.online/wp-content/uploads/2025/01/ctr07-2025.pdf

iv. Amendment in NN. 17/2017-Central Tax (Rate) – Notification No. 08/2025 – Central Tax (Rate)

Notification No. 17/2017-Central Tax (Rate) notifies the categories of services the tax on intra-State supplies of which shall be paid by the electronic commerce operator.

Vide this Notification, amendment has been made in term ‘Specified premises' to align with clause (xxxvi) of paragraph 4 of Notification No. 11/2017-Central Tax (Rate).

This Notification shall have an immediate effect i.e. 01.04.2025.

Similar Notifications have been issued under Union Territory Tax (Rate) and Integrated Tax (Rate) vide Notification No. 08/2025- Union Territory Tax (Rate) and Notification No. 08/2025- Integrated Tax (Rate) respectively.

The Complete Notification can be accessed at https://taxo.online/wp-content/uploads/2025/01/ctr08-2025.pdf