18% GST On Corporate Guarantees For Their Subsidiaries

The council, chaired by Union Finance Minister Nirmala Sitharaman and comprising state ministers, also cut the GST rate on molasses to 5 per cent from 28 per cent

The GST Council on Saturday clarified that guarantees provided by corporates to their subsidiaries will attract an 18 per cent GST, while no tax will be levied if a personal guarantee is given by a director to the company.

The council, chaired by Union Finance Minister Nirmala Sitharaman and comprising state ministers, also cut the GST rate on molasses to 5 per cent from 28 per cent.

It also ceded the right to tax Extra Neutral Alcohol (raw product for making alcohol for human consumption) to the states.