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Foodgrains, common-use products to get cheaper as GST Council decides service tax rate

ANI  |  New Delhi [India] 

The Goods and service (GST) council will decide the rate of Service today.

Union Minister at the first day of the two-day meeting in of the Council Council said that today they will decide on the rate of for services.

"The rates for bidis along with gold, footwear, bidi, biscuits, agriculture equipments and packaged food items would also be decided today. Two set of rules on transition provision and returns have been referred to legal committee," Jaitley said.

After a fixed rate is decided and implemented from July 1, foodgrains and common-use products like hair oil, soaps, toothpaste and also the electricity will cost less.

The rates for all 1,211 items but six were finalised, yesterday.

Council decided to exempt the daily-use commodities from the levy.

Prices of foodgrains, especially wheat and rice, will come down as they will be exempted from the

Currently, some states levy Value Added (VAT) on them. Daily-use items like sugar, tea, coffee (barring instant coffee), edible and life-saving drugs will attract the lowest rate of 5 per cent, almost the same as current incidence.

Milk and curd will continue to be exempt from taxation when the replaced current indirect taxes.

'Mithai' or sweets will attract 5 per cent levy.

The Common use products like hair oil, soaps and toothpaste will be charged with a single national sales or of 18 per cent instead of present 22-24 per cent incidence through a combination of central and state government levies.

The Council fitted all but six items in 5, 12, 18 or 28 per cent brackets.

Seven percent of the items fall under the exempt list while 14 per cent have been put in the lowest bracket of 5 per cent.

17 percent items are in 12 per cent bracket, 43 percent in 18 percent slab and only 19 percent of goods fall in the top bracket of 28 percent.

Cars, ACs, refrigerators and Aerated drinks will be in 28 percent bracket.

On top of the peak rate, small cars will attract a 1 per cent cess, mid-sized cars will attract 3 percent and luxury cars 15 percent.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, May 19 2017. 11:42 IST