GST Council Meeting:Presently under a rain alert in Delhi NCR, the GST Council Meeting is underway, taking tax rate cuts and rationalisation of slabs as its main agenda. The meeting, chaired by the Union Finance Minister along with state finance leaders, is currently discussing the issue of bringing food items and daily usage essentials to lower GST rates. The step is aimed at providing relief to households and also at simplifying the indirect tax system.
Major Focus on Essential Goods
The Council is likely to implement considerable changes which will result in the reduction of the present four-slab GST structure to the two main slabs comprising 5% for essential items and 18% for the rest of goods and services. Additionally, a higher rate of 40% can be imposed on luxury and sin goods. Such reforms may lead to a decrease in compliance burdens, and at the same time, people will be able to afford everyday products at lower prices. Food items, textiles, and basic household goods are the primary categories that are anticipated to be included in the 5% bracket.
Top 7 Products Likely To Get Rate Cut
If we consider the current proposals, these seven products are the ones that are most likely to get their rates cut:
●Toothpaste – the rate might move down from 18% to 5%.
●Shampoo – it is also predicted that the product will be transferred to the 5% slab.
●Talcum powder – there is a suggested decrease for the item to 5%.
●Soaps – the essential hygienic articles are very likely to enter the 5% category.
●Air-conditioners – the rate might go down from 28% to 18%.
●Televisions – the current 28% will be changed to 18%.
●Small hybrid cars – the reduction of the rate from 28% to 18% is the most probable scenario.
The proposed cuts are inclusive of both daily essentials and durable goods; thus, the tax system will be simpler for manufacturers, and the consumers will see the benefit in the form of lower prices.
