After a day-long meeting of the powerful Goods and Services Tax Council on GST revision, it was decided to revise tax on 60 products including washing machines and refrigerators and simplified compliance norms for most businesses. The new tax rates will be applicable from July 27.
The Council headed by Finance Minister Mr. Piyush Goyal also gave in to demands that sanitary napkins should be in the 0 per cent tax bracket to promote menstrual hygiene among women, not 12 per cent. In addition to this following 15 major decisions were taken in the course of the meeting :-
- After GST revision, rates for 17 consumer goods including washing machines, refrigerators, TVs, video games, vacuum cleaners, trailers, juicer mixer, grinders, shavers and hair dryers, water coolers, water heaters, lithium-ion batteries and electric iron slashed from 28 percent to 18 percent.
- GST revision rate of 18 percent will be applicable on TVs up to 68 cm (27 inch) in size
- Small handicraft will be exempted after the GST revision
- Deities made of stone, marble and wood exempted under GST
- Rakhis exempted under GST
- Knitted caps or otherwise under Rs 1,000/Unit now at 5 percent
- Ethanol for oil companies now under 5 percent slab
- Footwear under Rs 1,000 now under 5 percent slab
- Actual bill of hotel stay above Rs 7,500 will attract 28 percent GST. Actual hotel bill below Rs 7,500 will, however, attract only 18 percent GST
- Fortified milk will be exempted from GST
- Rates on paints, wall putty and varnish down to 18 percent from 28 percent
- Perfumes, toilet spray now under 18 percent slab
- GST on handbags, jewellery box, wooden box for paintings, artware of glass, stone endeavour, ornamental framed mirrors, handmade lamps etc reduced to 12 percent
- Simpler return filing process approved. Quarterly returns for business turnover up to Rs 5 crore instead of monthly filings. However, tax payment will be monthly. Nearly 93 percent traders and small businesses will get benefited from this. Exemption limit for traders in Assam, Arunachal Pradesh, Himachal Pradesh, Himalaya, Sikkim, increased from Rs 10 lakh to Rs 20 lakh
- No decision on sugar cess, to be decided in next meeting
The decline in the consumption tax rate come ahead of the festive season when the government hopes, cheaper prices would drive demand and more than make up for the loss of revenue due to lower rates.
Delhi’s Deputy Chief Minister Sri Manish Sisodia, who also handles the Finance portfolio, said many items under the 28 percent slab have been brought down. “I think the 28 percent tax slab should be done away with. The issue is being unnecessarily dragged,” he added.
The GST Council will meet next on August 4 to discuss the problems faced by small traders and businesses and entrepreneurship. The meeting will be completely focused on the MSME sector, Goyal said.