GST Rates Structure 2017
The GST council has lifted the veil
from GST rates across goods and services that will be applicable on different
goods and services. GST council has made the
much-awaited announcements around tax rates on various categories of goods.
There has been a hype around these rates for a while and now these rates are
finally in the public domain.
As soon as the GST rates were
announced a huge wave of curiosity hit across industry and trade bodies.
Everyone is evaluating their position as a result of this change.
The GST slabs are pegged at 5%, 12%, 18% & 28%. According to
the latest news from the GST council, the tax structure for common-use goods
are as under:
GST Rates Structure
|
Tax Rates
|
Products
|
|
5%
|
Edible oil, sugar, spices,
tea, coffee (except instant)
Coal (instead of current 11.69%)
Mishti/Mithai (Indian Sweets)
Life-saving drugs
|
|
12%
|
Computers, Processed food
|
|
18%
|
Hair oil, toothpaste and soaps
(currently at 28%)
Capital goods and industrial
intermediaries (big boost to local industries)
|
|
28%
|
Small cars (+1% or 3% cess)
Consumer durables such as AC and
fridge
Luxury & sin items like BMWs,
cigarettes and aerated drinks (+15% cess)
High-end motorcycles (+15% cess)
Beedis are NOT included here
|
In addition to the above, a few
other items were mentioned in the Council’s announcement of rates. These items,
and the applicable rates on them are as follows:
Sugar, Tea, Coffee and Edible oil
will fall under the 5 per cent slab, while cereals, milk will be part of the
exempt list under GST. This is to ensure that basic goods are available at
affordable prices.
The Council has set the rate for
capital goods and industrial intermediate items at 18 per cent. This will
positively impact domestic manufacturers as seamless input credit will be
available for all capital goods. Indeed, it is time for “Make In India”.
Coal to be taxed at 5 percent
against current 11.69 per cent. This will prove beneficial for the power sector
and heavy industries which rely on coal supply. This will also help curb
inflation.
Toothpaste, hair oil, and soaps
will all be taxed at 18 percent, where currently they are taxed at 28 percent.
Most of the cosmetics and fast moving consumer goods (FMCG) brands should get
the benefit of this tax reduction.
The ‘mithai’ from the neighbouring
sweet shop might lose some of its flavour as Indian sweets will now be taxable
at 5 per cent. If you have a sweet tooth, this could hurt your pocket a wee bit
in the coming days.
Plus, it was announced that:
for restaurants serving alcohol,
the tax bracket will be 18 per cent
education, healthcare are going to
be exempted from GST
services on Non-AC restaurants will
be 12 per cent.
Please
be informed….
