The goods and services tax
(GST) regime was rolled out on July 1 to replace multiple tax
slabs across the country and ease trade. Indivjal Dhasmana
takes a look at the several decisions the government
took after the introduction of the indirect tax
regime to ensure the roll-out was as smooth as possible:
Council holds out-of-turn meeting via video conferencing; raises cess
on cigarettes. Earlier, cigarettes were taxed at the peak rate of 28%, along with a cess
of 5%. This was lower than what was levied in the pre-GST
era. The additional tax
will give Rs 5,000 crore extra revenue to the exchequer that will be used to compensate the states.
The Central Board of Excise and Customs (CBEC) clarifies integrated GST
(IGST) will be levied only when goods are cleared by the Customs, in case of high-sea transactions; this clears ambiguity whether tax
being levied for each leg of a transaction.
The Council cuts rate on job works for the textile sector to 5% from 18%, approves e-way bill without revising a threshold of Rs 50,000 and allows setting up of screening panels under the anti-profiteering measure. Rates on inputs specific to tractors cut to 18% from 28%, on government
works contract cut to 12% from 18%. Rates on other services — including rent-a-car, job work in newspaper printing, entry to planetariums — reduced. Council recommends the Centre come out with an amendment in the compensation Bill to increase the ceiling on cess
on luxury cars from 15% to 25%.
Cabinet clears ordinance to increase ceiling on cess
on luxury cars, SUVs up to 25% from 15%. CBEC
notifies e-way bill; exempts items of mass consumption such as vegetables, fruits, foodgrain, meat, bread, curd, books, jewellery, judicial and non-judicial stamp papers, newspapers, khadi, raw silk, Indian flag, cheques, municipal waste, liquefied petroleum gas for cooking, kerosene, heating aids and currency.
Sources: Finance ministry, GST Council