56th GST Council Meeting Highlights: Date, Venue, Agenda, Expectations and Latest News

The 56th GST Council meeting will happen on 3rd and 4th September 2025 at New Delhi, announced by the GST Council. The GST Council will meet after six months to discuss the long-pending agenda items. You must look out for deliberations around the GST rate rationalisation measures, and compliance simplification.

Let’s explore what’s potentially on the 56th GST Council meeting agenda in this article.

Key Takeaways

• 56th GST Council meeting will happen on 3rd and 4th September 2025 at New Delhi.
• 15 August 2025- On the 79th Independence Day, 15th August 2025, Prime Minister Narendra Modi announced the implementation of Next-Generation GST reforms. 
• The GST reform is expected to remove 12% and 28% tax slabs, while merging items into the 5% or 18% tax slabs, introduce a 40% tax slab for sin goods, correct the inverted tax structure.
• The agenda would also include deliberations on introducing pre-filled returns and automated GST refunds.

About the GST Council meeting

The GST law mandates GST Council meetings to happen once a quarter, unlike the 56th GST Council meeting. The Union Finance Minister Nirmala Sitharaman is the Chairperson of the GST Council. The Union Minister of State in the Finance Ministry and members representing the Ministers of 28 States and three Union Territories (with legislatures) shall accompany the Chairperson. 

GST Rate Rationalisation

A much-needed move from the GST Council expected at the 56th GST Council meeting is restructuring and rationalising the GST rate structure. The Group of Ministers (GoM) for rate rationalisation, along with the fitment committee, had delayed the submission of its report at the 55th GST Council meeting held in December 2024. 

In February 2025, Sanjay Agarwal, chairman of the Central Board of Indirect Taxes and Customs (CBIC), mentioned that socio-economic and revenue factors had made the GST rate rationalisation task challenging for the Group of Ministers and the fitment committee. He further stressed that the GoM must reach a consensus on the recommendations for GST rate rationalisation.

Media reports suggest that GoM  hahas approved the Centre's decision to shift items in 12% and 28% GST rate slab may be shifted to either the 5% or the 18% slabs.ntroduction of 40% GST slab for sin goods is also being contemplated. The GST Council may pass the final recommendation.

There are speculations that the GoM will also recommend removing the inverted tax structure prevalent across industries such as textiles, footwear, fertilisers, paper and packaging. The GST Council is likely to recommend a phased approach for GST rate rationalisation, such that the rule change allows taxpayers enough time to implement GST rate changes while avoiding any potential anti-profiteering issues.

Review of Compensation Cess

The GST Council may decide whether to extend or end the levy, collection, and distribution of compensation cess to States. Currently, the GST Council has to repay the back-to-back loans to meet the shortfall in GST Compensation. Media reports indicate that the GST Council might replace compensation cess with health and clean energy cess after March 2026. If the change were to come into force, it needs constitutional amendment.

Levy and collection of compensation cess was extended up to 31st March 2026. A GoM is formed to study the possibility of a new tax levy to replace the compensation cess after it ends. The GoM is headed by the Minister of State in the Finance Ministry, Pankaj Chaudhry and is slated to submit their report by 30th June 2025.

GST Rate Changes 

Taxation of certain items under GST is still being contemplated. One such item is the GST on health insurance. The GST Council at its 55th meeting provided a timeline extension for the GoM to study GST on insurance premia. The taxation of health insurance and life insurance under GST could be deliberated at the 56th GST Council meeting. An 18% GST rate is currently charged on insurance premia, which is proposed for an exemption.

There is speculation that the 56th GST Council may unify the GST levy on commercial drones. The Council may recommend reducing the GST rate on drones from 28% to 5%. Also, taxation of GST on drones with detachable cameras has been a significant point of contention. 

The move will clarify the classification of goods in the Unmanned Aircraft System (UAS). A higher rate of 28% is levied for the personal use of drones, whereas a lower rate of 5% is charged for business use under the HSN code 8806. The tax authorities have mostly charged 18% GST on these drones by classifying them as camera equipment instead of aircraft. Industry experts claim that drones must be categorised based on their main operation, airborne mobility rather than additional accessories.

The Council may also consider GoM submissions on charging GST on virtual digital assets, the practical implementation of CGST Section 11A (to waive recovery of GST not levied or short-levied due to common trade practices in specific sectors), and sector-specific clarifications for e-commerce, real estate, and gaming.

The 56th GST Council meeting is crucial for many industries as some of the long-standing issues may find closure.