Now, only 35 goods in highest tax bracket of GST

The GST Council has pruned the 28 per cent slab by cutting tax rates on 191 goods over the last one year, leaving just 35 items, including AC, digital camera, video recorders, dishwashing machine and automobiles, in the highest tax bracket.

There were around 226 goods in the 28 per cent category when Goods and Services Tax (GST) was implemented on July 1, 2017.

Over the last one year, the Council, chaired by Union Finance Minister and comprising state ministers, has slashed rates in 191 items.

The 35 goods, which will be left in highest slab once the new GST rates are implemented from July 27, also include cement, automobile parts, tyres, automobile equipment, motor vehicles, yachts, aircraft, aerated drinks, betting and demerit items like tobacco, cigarette and pan masala.

Experts said going forward as the revenues stabilise, the Council may look at further rationalisation of the 28 per cent slab, to restrict the highest tax slab to super luxury and sin goods.

After the latest rounds of rate cuts by the GST Council on July 21, only 35 items are left in the 28 per cent tax slab, an official said.

The Council brought down tax rates to 18 per cent from 28 per cent on 15 items, including vacuum cleaners, washing machine, 68 cm (27- inch) TV, fridge, laundry machines, paints and varnishes.

“The rate cuts would lead to a revenue loss of about Rs 6,000 crore,” the official said.

Furthermore, slabs under Goods and Services Tax (GST) can be reduced to three from five at present for the convenience of consumers and businesses though it will take some time, Bihar Deputy Chief Minister Sushil Kumar Modi said in an interview. Modi also heads highlevel minister panel on GST.

He said that there are five slabs in GST and “there is an intention to reduce it to three slabs, but it will take some time” as it is related to states’ revenue.

Reacting to questions raised by former finance minister P Chidambaram that why GST council did not reduce rates of 88 items in 2017, Modi said: “This is not a decision where only BJP government is involved. The decision has been taken by GST Council in which Congress-led governments are also involved”.