FM Nirmala Sitharaman gives big relief Revises GST rates
FM Nirmala Sitharaman gives big relief
Revises GST rates
The new structure comes into effect from September 22
The GST Council on Wednesday cleared major changes to India’s tax system, with the introduction of two main slabs of 5% and 18%. These comes to effect from September 22. Earlier those goods had 12% or 28% GST will mostly shift to the new lower slabs, making a wide range of products more affordable, while keeping a high 40% tax on sin and luxury goods.
The new structure that comes into effect from September 22, will have fewer GST slabs – 0%, 5%, 18%, and 40%. The aim is to make the system simpler, keep essentials and clean energy affordable, and ensure luxury and harmful products remain costly.
What gets cheaper from September 22:
*Daily Essentials
Ultra High Temperature (UHT) milk, Indian breads, which was taxed at 5%, will no longer be taxed.
*Other dairy products like condensed milk, butter, ghee, cheese will now fall under the 5% tax bracket, instead of 12%.
*Hair oil, toothpaste, toilet soap bar, toothbrush and shaving cream will now see a cut from 18% to 5%.
*Popular items like almonds, cashews, pistachios, hazelnuts, and dates will now be taxed at only 5%, instead of 12%.
*Utensils, feeding bottles, napkins for babies and clinical diapers, sewing machines and parts will see a cut from 12% to 5%.
*Refined sugar, syrups, and confectionery products like toffees and candies have been shifted to the 5% category.
*Vegetable oils, animal fats, spreads, sausages, meat and fish products, and foods made with malt extract will also attract only 5% GST.
Namkeens, bhujia, mixtures, and other ready-to-eat savoury snacks will see a drop in tax from 12% to 5%.
*Mineral water, aerated water, and other packaged waters without added sugar or flavours will now be taxed at 5%.
Agriculture and Fertilisers
*Fertilisers will now be taxed at 5%, instead of 12–18%. While tractor tyres and parts will see a cut from 18% to 5%, tractors will come under 5%, down from earlier 12% rate. Infact, specified bio pesticides, micro nutrients , drip irrigation systems and sprinklers, and agricultural, horticultural or forestry machines used for soil preparation, cultivation, harvesting and threshing, will be down from 12% to 5%.
*Thermometers and individual health and life insurance have been shifted from 18% tax rate to 5% and nil, respectively. Things like medical grade oxygen, diagnostic kits and reagents, glucometer and test strips and corrective spectacles, are now down to 5%, instead of 12%.
*Goods for education like maps, charts, globes, pencils, shrpners, crayons, pastels, exercise books and notebooks, eraser were earlier taxed 12%, but now they have all ben brought down to ‘nil’.
*Electronic appliances
Air conditioners, television (above 32 inch) including LED and LCD Tvs, monitors, projectors and dish washing machines will see a cut from 28% to 18%.
*Automobiles
Petrol and petrol hybrid cars, LPG, CNG cars (that are not exceeding 1200 cc and 400 mm) will also see a cut from 28% to 18%
Other Sectors
*Renewable energy devices, construction materials, sports goods, toys, leather products, wood items, and handicrafts will now all fall under the 5% GST slab, down from 12%.
LIVE: ‘8 years too late’, Chidambaram says current rates should not have been imposed
What gets costlier from September 22?
Even as many goods are getting cheaper, some products will continue to face high taxes.
*Products like pan masala, gutkha, cigarettes, chewing tobacco, zarda, raw tobacco, and bidis will stay under the same steep GST rates, along with an extra cess. This will continue until the government clears loans linked to the cess.
Also, these items will now be taxed based on their Retail Sale Price (RSP) instead of the transaction value, making the rules stricter for compliance.
*All sweetened or flavoured drinks, including aerated waters, will now face a higher GST of 40%, up from 28%.
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News Edit KV Raman
