Insulin, pickles to cost less now
GST Council revises tax rates for 66 items
In a move that will bring cheer to some, the GST Council on Sunday reduced the tax rates on 66 items it had fixed earlier, making household items like pickle, ketchup, cutlery, agarbatti, kajal, school bags, children’s exercise and drawing books, and office necessities like printers cheaper.
On one specific item, movie tickets, the council decided on two tax slabs. Tickets costing `100 or less will be taxed at 18 per cent, and those above `100 will be taxed at 28 per cent. Earlier, the council had decided to tax all cinema tickets at 28 per cent, irrespective of the ticket price.
The revision of tax rates comes within weeks of the all-powerful GST Council slotting over 1,200 items into one of the four tax slabs — 5, 12, 18 and 28 per cent. The GST Council had received representations from various industry groups to reduce tax rates on 133 items that had been put under a higher tax category.
In a relief to SMEs, the GST Council decided that small traders, manufacturers and restaurant owners with a turnover of up to `75 lakh can opt for a composition scheme against the earlier limit of `50 lakh. Under the composition scheme, traders need to pay just one per cent, manufacturers two per cent and restaurants five per cent of overall income as tax and not GST rates. Traders with an annual income of `20 lakh or less are exempt from GST. Finance minister Arun Jaitley said the reductions were done keeping in mind equivalence to the existing taxation level.
In a move that will bring cheer to some, the GST Council on Sunday reduced the tax rates on 66 items it had fixed earlier, making household items like pickle, ketchup, cutlery, agarbatti, kajal, school bags, children’s exercise and drawing books, and office necessities like printers cheaper.
“In some cases, the fitment committee’s recommendation went beyond the equivalence principle because some items, which have been historically charged at a higher rate, but, in today’s changed economic scenario, the burden requires to be reduced. So, after considering the recommendations, the Council has reduced the tax levels in 66 out of 133 cases,” Mr Jaitley said.
The Council, which will again meet next Sunday to look at any pending issue and fix the tax rate on lottery, decided to revise downwards tax rate on food items like pickles, mustard sauce, ketchup, chutney, morabba, instant food mixes, toppings and spread-over sauces from the proposed 18 per cent to 12 per cent. Tax rate on cashew nuts has been cut to five per cent from the proposed 12 per cent.
“Many of these items are used by common people,” Mr Jaitley said.
As far as healthcare is considered, the GST Council reduced proposed tax on insulin used by diabetic patients to five per cent from the earlier 12 per cent, and on dental wax from 28 to 18 per cent.
Parents can also breathe a sigh of relief as the council cut tax on school bags from 28 to 18 per cent, on exercise books from 18 to 12 per cent and colouring and drawing books from 12 per cent to nil.
Tax rate on agarbatti was revised from 12 to five per cent, kajal from 28 to 18 per cent, cutlery from 18 to 12 per cent and computer printers from 28 to 18 per cent.
For workers who take work home, in sectors like textile, jewellery, diamond processing, leather, jewellery and printing, GST rates have been brought down from 18 to five per cent.
HOWEVER, in a setback for the telecom industry GST Council didn’t entertain their request to reduce GST rate from the present 18%