- Tax rates of 66 items were revised by the GST Council after receiving demands from various quarters of the country
- The Council also increased the threshold of turnover for businesses which can opt for composition scheme to Rs 75 lakh, from Rs 50 lakh proposed earlier
- The minister said the GST Council have gone deep into all the cases and whatever rates have been decided are broadly the final rates
Tax rates of 66 items were revised by the GST Council after receiving demands from various quarters of the country. This comes ahead of the roll-out of the one-country-one-tax regime on July 1.
The GST Council met for the 16th time on Sunday, June 11, 2017, and decided to reduce taxes on items like, agarbattis, computer printers and cashews among others.
In a relief to SMEs, the Council also increased the threshold of turnover for businesses which can opt for composition scheme to Rs 75 lakh, from Rs 50 lakh proposed earlier.
Here is a list of things that has been revised-
- Movie tickets costing up to Rs 100 will attract 18 per cent tax, as against 28 per cent proposed earlier. Those above Rs 100 will continue to attract 28 per cent GST.
- Packaged food items like fruits and vegetable products, pickles, murabba, ketchup, mustard sauce, topping spread, instant food mixes and chutney, will attract 12 per cent GST, as against 18 per cent proposed earlier. Tax rates on cashew nuts have been cut to 5 per cent from 12 per cent.
- The GST on insulin and agarbatti has also been lowered to 5 per cent, from 12 per cent. Computer printers and school bags will attract 18 per cent rate, as against 28 per cent proposed earlier.
- Children's picture, colouring drawing books have been exempt from GST, as against the 12 per cent proposed earlier. The tax on kajal has been cut to 18 per cent from 28 per cent.
- While GST on cutlery has been reduced to 12 per cent from 18 per cent, the rate on tractor components, plastic beads and plastic tarpaulins have been cut to 18 per cent, from 28 per cent.
- The tax rate on job workers in textile, diamond processing, leather, jewellery and printing, has been decided at 5 per cent, as against the normal 18 per cent GST rate for services.
Giving reasons for lowering thetax rates, Jaitley said the objective was to maintain equivalence to the existing taxation level.
"In some cases, the fitment committee's recommendation went beyond the equivalence principle because some items, which have been historically charged at a higher rate, today in the changed economic concept the burden requires to be reduced. So, after considering the recommendations, the GST Council has reduced the tax levels in 66 out of 133 cases," he said.
West Bengal Finance Minister Amit Mitra hailed today's Council decisions saying common people gained from this and termed increasing the turnover limit for availing composition scheme and reduction intax rates for cinema tickets as "people-centric measures".
On the issue of review of GST rate on hybrid cars, Jaitley hinted that the tax rate will not be reviewed, saying the industry demands were not in sync with a study conducted by tax officers.
The Council also approved the accounts and record rules for the GST regime and in the next meeting on June 18, it will take up taxes on lottery and e-way bill for discussion.
As regards composition scheme, Jaitley said the small and medium enterprises act as mass job creators and hence the industry demand was important.
The composition scheme provides for a easier method of calculating tax liability and allows GST registration for dealers with turnover below the compounding cut-off.
Asked if there would be any further revision of rates, the minister said the GST Council have gone deep into all the cases and whatever rates have been decided are based on "informed reasons" and "detailed discussions" and are broadly the final rates.
Last Updated 31, Mar 2018, 6:59 PM