GST Council meet begins, may cut rates on key items

arun-jaitley-100-e1470368679219.jpg

The meeting comes amid intense political debate between the BJP-led government and the Opposition Congress over the implementation of the tax reform that was rolled out on July 1, 2017.

The GST Council, in its meeting today, is expected to slash tax rates on several items in a bid to rationalise the highest tax bracket of 28 per cent as indicated by Prime Minister Narendra Modi in a recent remark.

The 31st GST Council meeting, which is currently underway, comes amid intense political debate between the BJP-led government and the Opposition Congress over the implementation of the tax reform that was rolled out on July 1, 2017.

The Prime Minister had hinted a few days ago that his government was working on bringing 99 per cent things under sub-18 per cent slab of GST.

“Today, the GST system has been established to a large extent and we are working towards a position where 99 per cent things will attract the sub-18 per cent GST slab,” Modi said at in function in Mumbai on Tuesday.

To this, Congress president Rahul Gandhi response was that the government was doing the very same thing it had criticized the UPA government for.

“The Congress has finally jolted Narendraji from his deep slumber on Gabbar Singh Tax. Though still drowsy, he now wants to implement what he had earlier called the Congress Party’s ‘Grand Stupid Thought’. Better late then never Narendraji!,” Gandhi tweeted.

In response, Finance Minister Arun Jaitley said that the idea of single tax slab was flawed. ‘A single slab GST argued by the Congress president is indeed a stupid idea. Luxury and sin items can’t be taxed at the same rate as the common man’s”, he tweeted.

Former Finance Minister P Chidambaram replied, “When the Congress President said — as I have said — GST should be a single rate, it means that the standard rate of GST should be a single rate. That’s absolutely correct. As Dr Arvind Subramanian’s RNR [Revenue Neutral Rate] report pointed out, when there is a standard rate there will also be a standard-minus rate and a standard-plus rate. That’s elementary, not stupid.”

GST has five tax slabs of 0 per cent, 8, 12, 18 and 28 per cent with daily essential items attracting nil tax rates and luxury, sin and some white goods at the highest tax slab.

Currently there are 34 goods left in the highest tax bracket of 28 per cent. The list include commonly used items like ‘new pneumatic tyre of rubber’ (automobile tyre), digital camera, air conditioners, dish washing machine, set top box for TV, monitors and projectors as well as construction item like .

According to reports, the Council is likely to slash tax rates on automobile tyres to 18% from 28%. “A 28 per cent tax on automobile tyre impacts common man because ultimately he has to shell out the tax. The overall focus on December 22 Council meet will be to lessen the GST burden on common man,” an official told PTI.

Another item under discussion could be cement. “Cement is an area where huge instances of evasion was taking place. If tax rates come down more people will buy it from the formal channel and would also boost housing sector as well,” the official added.

The items that are likely to be retained in the 28 per cent slab include aerated drinks, cigarette, bidi, tobacco products, pan masala, smoking pipes, automobiles, aircrafts, yachts, revolvers and pistols, gambling lottery.

Source : https://www.hindustantimes.com/india-news/gst-council-meet-begins-may-cut-rates-on-key-items/story-7sSQCbSZPTJcVizI0iLZIN.html

Leave a Reply

Your email address will not be published.

Solve this and then Post Comment *

scroll to top