GST rates lowered for 66 items
Taxes reduced for packaged food items, movie tickets below ~100, insulin
“changing consumption pattern and economic realities”. Tax burden on some of these items were historically high, he said.
The Council had received proposals seeking a review of the tax classification for 133 items.
Jaitley, however, hinted the GST rate on sanitary napkins will not be reviewed. Activists had called for lower taxes on sanitary napkins, urging the government to put the products in reach of more women and girls.
He also suggested the tax rate for environment-friendly hybrid cars will not be reviewed. They will attract a 15% cess over and above the 28% GST, the same rate levied on large luxury cars and sport utility vehicles.
Telecom services will attract 18% GST, as had been decided in May, up from the 15% service tax the sector attracts at present.
The council also relaxed the turnover ceiling of ₹50 lakh to ₹75 lakh per annum for businesses to take part in the GST Composition Scheme. The scheme allows traders, manufacturers and restaurant owners to pay a presumptive taxes at the rate of 1, 2, and 5% respectively.
This will allow more small businesses to avail of a hasslefree compliance regime. These segments are large job creators, a priority area for the government.
Pratik Jain, partner and leader, indirect tax, PricewaterhouseCoopers Pvt. Ltd said raising the scheme’s limit will provide relief to many more small businesses,althoughserviceproviders (except restaurants) continue to remain outside its ambit.
Despite calls from West Bengal finance minister Amit Mitra recently to postpone implementation of GST, the Council decided to go ahead with the planned July 1 roll-out. The Council will meet again on 18 June to take stock of the roll-out preparedness and any new proposal from state governments.
Mitra toned down his demand on Sunday. When asked about West Bengal’s readiness for the roll-out, Mitra said, “Let us see. There is still one more meeting of the GST Council for assessing the preparedness. Whenever we are prepared fully to our satisfaction, everybody feels comfortable, we can go ahead,” Mitra said.
He added that the tax reform cannot be implemented in an ad hoc manner and that deferring implementation by a month will be helpful.