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India's Goods and Services Tax (GST) Council is expected to decide whether tax will be levied on corporate and personal guarantees on loans or debt issuances, according to a source.

Such a tax has long been under debate in the country.

The decision will be taken by the GST Council, which consists of federal finance minister and state finance ministers, in its next meeting on Oct 7.

According to a proposal that the GST Council will consider, an 18% tax would be applicable on the declared value of the corporate guarantee, or 1% of the guaranteed amount in cases where the value of commission for the guarantee is not known.

Companies provide guarantees to banks on behalf of their holding companies or subsidiaries and charge a fee. The fee or commission depends on credit-worthiness of the firm or amount guaranteed, among others.

The panel will also consider a plan to exempt GST on some millet flour products from 18% presently, and plans to stick to 18% tax applicable on electric vehicle batteries. The government will also study how to tax some services provided by cryptocurrency platforms.