Introduced on July 1st, Goods and Service Tax still continuous to be the matter discussion among the people and council. Recently, the GST council headed by Finance Minister, Arun Jaitley announced major cuts in taxes of various items.
This step was taken on the complain of traders, small and medium enterprises. They complained about the tedious compliance burden under the new tax regime. To ease their burden, the council has decided to reduce GST slab rates on 27 commonly used items.
It is 3 months after the imposition of the bill that the changes are being made. The revision category comprises goods of common consumption, including roti, khakra, namkeens, stationery and man-made yarn and most of them have been brought to five percent category.
Revised GST Slab Rates
The list of items with the existing rates and revised slab has been provided below:
- On Aam Papad the existing rate of 12% has been replaced to 5%
- Khakda and Papad from 12% to 5%
- Namkeens other than those put up in unit container and, – (a) bearing a registered brand name; or (b) bearing a brand name on which an actionable claim or enforceable right in a court of law is available [other than those where any actionable claim or enforceable right in respect of such brand name has been foregone voluntarily from 12% slab has shifted to 5%
- On Ayurvedic, Unani, Siddha, Homeopathy medicines, other than those bearing a brand name existing rate was 12% and now it is 5%
- Nylon, Polyester and Acrylic from 18% to 12%
- Handmade thread from 18% to 12%
- Biomass briquettes from 18% to 5%
- On Poster colors shifted from 28% to 18%
- Modelling paste for children amusement from 28% to 18%
- Selective stationery items from 28% to 18%
- Selective parts of Diesel engine from 28% to 18%
- E-Waste from 28% to 5%
- Parts suitable for use solely or principally with power driven pumps primarily designed for handling water, namely, centrifugal pumps (horizontal and vertical), deep tube-well turbine pumps, submersible pumps, axial flow and mixed flow vertical pumps from 28% to 18%
- Plain Shaft Bearing 8483 from 28% to 18%
- Fittings for loose-leaf binders or files, letter clips, letter corners, paper clips, indexing tags and similar office articles, of base metal; staples in strips (for example, for offices, upholstery, packaging), of base metal from 28% to 18%
- Cullet or other waste or scrap of Glass from 18% to 5%
- All goods falling under heading 6802 [other than those of marble and granite or those which attract 12% GST] from 28% to 18%
- Real Zari from 12% to 5%
- Yarn of man-made staple fibres from 18% to 12%
- All artificial filament yarn, such as viscose rayon, Cuprammonium from 18% to 12%
- Paper waste or scrap from 12% to 5%
- Hard Rubber waste or scrap from 28% to 5%
- Plastic waste, parings or scrap from 28% to 5%
- Imposing GST only on the net quantity of superior kerosene oil [SKO] retained for the manufacture of Linear Alkyl Benzene [LAB] the slab of 18% is applicable.
- Yarn of man made staple fibres from 18% to 12%
- Duty credit scrips from 5% to Nil
- Rubber waste, parings or scrap from 18% to 5%
The council took the measure to rationalize the tax rates and this trend will continue. Minister of state for finance said “The 28% slab would fall as per genuine and legitimate aspirations of the people in general and industry in particular”. The revision in future will be done if required in the present structure.
The 28% slab includes the item such as chocolates (with and without cocoa), extract or concentrate of coffee, certain non-alcoholic beverages, sweetened aerated drinks, tobacco other than bidi, marble, granite, wall paper, certain types of cement, paints, varnishes, perfumes, beauty and skin care products and after shave lotions.
The services such as going to entertainment events, movies and accommodation in five star and above rated hotels where tariff is Rs. 7,500 or above will also attract 28% tax.
The concept behind introducing GST Bill in the Indian Economy was to simplify the prevailing taxation norms and make it easy for the general public to understand the tax policy. Instead of multiple paying multiple taxes, they had to pay single tax. And to ensure that it continues to benefit the common man, the Federal Tax Body headed by the Finance Minister reviews and shuffles the commodities and services within various slab rates.