FM says next priority will be to transfer cement into a lower slabThe finance minister Arun Jaitley in his blog has indicated that with the GST transformation completed, India is close to completing the first set of rate of rationalisation i.e. phasing out the 28% slab except in luxury and sin goods. The finance minister said that a future road map could well be to work towards a single standard rate instead of two standard rates of 12% and 18%. It could be a rate at some mid-point between the two. The country should eventually have a GST which will have only slabs of zero, 5% and standard rate with luxury and sin goods as an exception.
The country faced with a situation with a large number of commodities being taxed heavily in the pre-GST regime with indirect tax of 31%. Today, barring tobacco products, luxury vehicles, molasses, air-conditioners, aerated water, large TVs, and dish washers, all 28 items have been transferred from 28% slab to 18% and 12% slab. Only cement and auto parts are items of common use which remain in 28% slab. The finance minister indicated that next priority will be to transfer cement into a lower slab. All other building materials have already been transferred from 28% to 18% and 12%. The sun is setting on the 28% slab.
Of the 1216 commodities which are used, broadly 183 are taxed at zero rate, 308 at 5%, 178 at 12% and 517 at 18%. The 28% slab is now a dying slab. Restaurants are being levied a tax compounded under the composition of turnover at 5%. Assessees with turnover upto Rs 20 lakhs are exempted from tax payment. Assessees upto Rs 1 crore turnover can get a composition by paying 1% tax. The composition scheme for small service tax assessees is under consideration. Cinema tickets tax between 35% to 110% has been brought down to 12% and 18%. The FM has emphasized that the GST has helped in controlling inflation, while evasion has also come down.
Powered by Capital Market - Live News
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)