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The goods and services tax (GST) rate on mobile phones and fabric may be hiked by the GST Council next week. This could be part of an exercise to correct the inverted tax structure and boost revenue collection.
The structure of higher tax rates on inputs than on final products is resulting in a huge input tax credit outgo. Other items which have seen an inverted duty structure include fabric bags, shoes, tractors etc.
The GST rate on mobile phones is 12 per cent, whereas that on phone parts and batteries is 18 per cent, triggering an inverted tax structure. That, in
