The GST Council today slashed tax rates on a number of items and a major reprieve for the common man decided to brought all AC and non-AC restaurants under 5 per cent tax bracket.
The massive pruning was done in the 28 per cent slab which will now be imposed on just 50 items from 227 earlier. Many of the items and services which were earlier taxed at 28% will now attract tax of 18% only.
Here’s what Finance Minister Arun Jaitley said at the press conference:
* In our effort to rationalise GST structure, the council has been reviewing rates from time to time.
* Initially the principal of equivalence was maintained…where in tax on items which were prevalent on items before July was maintained.
* In last three meetings, 30-40 items have been removed ..
* Wheat grinders and armour fighting vehicles have been brought to 12 per cent
* 13 items have been shifted to 12% from 18% GST bracket
* Six items have been moved from 18% to 5% bracket.
* Eight items from 12% have been moved to 5%
* Six items have been shifted from 5% GST bracket to 0% basket
* Have decided to not give input tax credit to restaurants as it was found that they were not passing on the benefits to con ..
* Hotels with room rent of Rs 7,500 and above will attract 18%?? tax.
Finance Secretary Hashmuk Adhia also spoke at the conference. Here’s what he said:
* This was a learning cycle for us.
* Penalty on late filing reduced: For nil tax, late filing penalty reduced to Rs 20 per day from Rs 200?.?
* For others late filing penalty reduced from Rs 200 per day to Rs 50 per day.
* There will be uniform rate of one per cent on both traders and manufacturers.
* Composition scheme threshold has been increased to Rs 1.5 crore which require amendment of law. The cap on the scheme will be increased to Rs 2 crore.
* In the current year, all taxpayers will have to file only GSTR-1.
* New GST rates will come into effect from November 15
* Nobody can charge more that MRP