ALSO READIf GST Council feels the need to change tax rates, it will: Traders urge GST Council to remove anomalies in tax slabs GST Council may take up certain tax issues at Aug meet 81% goods under 18% tax bracket, 4 tax slabs for goods and services finalised under GST GST Council to continue rationalising rates: Shukla
The Council today reduced the rates for products such as detergents, shaving and after-shave items, deodorants, women cosmetics and chocolates, among others.
"These revisions in rates are expected to reduce prices and increase consumption and thereby bring growth for the consumer products and retail industry," EY India said in a statement.
Goods and Services Tax (GST) on 178 items were brought down to 18 per cent at the meeting of the Council today along with reduction in compliance burden.
The other decision relating to traders is doubling of turnover limit for composition dealers to Rs 2 crore.
This will have a huge impact on the GSTN portal as well because there will be a big rise in taxable persons opting for the composition scheme and they will be required to file quarterly returns only.
"This decision will not only reduce pressure from the GSTN portal, but also cut down workload of tax practitioners and worries of traders by doing away with three returns forms per month," another tax consultancy firm Taxmann said.
According to PwC, 5 per cent rate on restaurants (except those in star hotels) without any input credit might not be the best decision from a tax policy standpoint and breaks the chain, which is not desirable.
From a consumer standpoint, however, it should lead to some decrease in prices, particularly in the case of small restaurants, the company said.